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NORTHSARpLINA
EGIsfER
VOtUME14 ISSUE 17 • Pages 1492 - 1592
PUBLISHED BY
The Office ofAdministrative Hearings
Rules Division
6714 Mail Service Center
Raleigh, NC 27699-6714
Telephone (919) 733-2678
Fax (919) 733-3462
This publication is printed on permanent, acid-free paper in compliance with G.S. 125-11.13
For those persons that have questions or concerns regarding the Administrative Procedure Act or any of its
components, consult with the agencies below. The bolded headings are typical issues which the given
agency can address, but are not inclusive.
Rule Notices. Filings, Register. Deadlines. Copies of Proposed Rules, etc
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Rules Division
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424 North Blount Street
Raleigh, North Carolina 27601-2817
(919)733-2678
(919) 733-3462 FAX
contact: Molly Masich, Director APA Services
A' Ruby Creech, Publications Coordinator
iff *^ //
Fiscal Notes & Economic Analysis
// Office of State Budget and Management
jl 16 West Jones Street
fRaleigh, North Carolina 27603-8005
contact: Warren Plonk, Economist III
mmasich@oah.state.nc.us
rcreech@oah.state.nc.us
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(919) 733-0640 FAX
wplonk@osbm.state
II
Rule Review and Legal Issues \
Rules Review Commission
\l^> 1307 Glenwood Ave., Suite 159
\\ Raleigh, North Carolina 27605
i; contact: Joe DeLuca Jr., Staff Director Counsel
Bobby Bryan, Staff Attorney
(919)733-2721
(919) 733-9415 FAX
\V\\rt«»v \r •NH
Legislative Process Concerning Rule-making
Joint Legislative Administrative Procedure Oversight Committee
545 Legislative Office Building
300 North Salisbury Street (919) 733-2578
"^
Raleigh, North Carolina 276 11 (9 19) 7 1 5-5460 FAX
contact: Mary Shuping, Staff Liaison marys@ms.ncga.state.nc.us >^
County and Municipality Government Questions or Notification
NC Association of County Commissioners
2 1 5 North Dawson Street (9 1 9) 7 1 5-2893
Raleigh, North Carolina 27603
contact: Jim Blackburn or Rebecca Troutman
NC League of Municipalities
215 North Dawson Street
Raleigh, North Carolina 27603
contact: Paula Thomas
(919)715-4000
This publication is printed on permanent, acid-free paper in compliance with G.S. 125-11 .13
NORTH CAROLINA
REGISTER
Volume 14, Issue 17
Pages 1492 - 1592
March 1, 2000
This issue contains documents officially filed
through February 9, 2000.
Office of Administrative Hearings
Rules Division
424 North Blount Street (27601)
6714 Mail Service Center
Raleigh, NC 27699-6714
(919)733-2678
FAX (919) 733-3462
Julian Mann 111, Director
Camille Winston, Deputy Director
Molly Masich, Director of APA Services
Ruby Creech, Publications Coordinator
Linda Dupree, Editonal Assistant
Jessica Flowers, Editorial Assistant
Dana Sholes, Editorial Assistant
IN THIS ISSUE
I. EXECUTIVE ORDERS
Executive Order 167 1492
II. IN ADDITION
Licensing Boards
Social Work Certification & Licensure Bd. . 1493
Voting Rights Letters 1494 - 1495
III. RULE-MAKING PROCEEDINGS
Environment and Natural Resources
Environmental Management 1496 - 1497
Health and Human Services
Child Care Commission 1496
Public Education
Elementary & Secondary Education 1497
Secretary of State
Securities Division 1497 - 1499
IV. PROPOSED RULES
Health and Human Services
Medical Assistance 1500 - 1506
Public Education
Elementary & Secondary Education 1506 - 15 1 1
V. TEMPORARY RULES
Agriculture
Hurricane Floyd Recovery Programs 1512-1513
Commerce
Departmental Rules 1513 - 1515
Environment and Natural Resources
Departmental Rules 1515 - 1520
Wildlife Resources Commission 1520 - 1522
Health and Human Services
Health Services 1522 - 1523
Licensing Boards
Cosmetic Arts Examiners 1523 - 1524
VL APPROVED RULES 1525 1566
Commerce
Cape Fear River Navigation & Pilotage Commission
Environment and Natural Resources
Coastal Resources Commission
Departmental Rules
Environmental Management
Health Services
Marine Fisheries Commission
Health and Human Services
Child Care Commission
Facility Services
Vocational Rehabilitation Services
Independent Agencies
Housing Finance Agency
Licensing Boards
Pharmacy, Board of
VII. RULES REVIEW COMMISSION 1567-1576
VIII. CONTESTED CASE DECISIONS
Index to ALJ Decisions 1577 - 1585
Text of Selected Decisions
99EHR0770 1586-1592
IX. CUMULATIVE INDEX 1-96
Norlli Carolina Register is published senu-monthK for $ 195 per \ear by the Office of Administrative Hearings, 424 North Blount Street. Raleigh, NC 2760 1
.
(ISSN 1 5200604) to mail at Penodicals Rates is paid at Raleigh, NC. POSTMASTER: Send Address changes to the Norlh Carolina Register, PO Drawer
27447. Raleigh. NC 2761 1-7447,
NORTH CAROLINA ADMINISTRA TIVE CODE CLASSIFICA TION SYSTEM
The North Carolina Administrative Code (NCAC) hasfour major subdivisions of rules. Two of these, titles and chapters,
are mandatory. The major subdivision of the NCAC is the title. Each major department in the North Carolina executive
branch of government has been assigned a title number. Titles are further broken down into chapters which shall be
numerical in order. The other two, subchapters and sections are optional subdivisions to be used by agencies when
apyropriale
.
TITLE/MAJOR DIVISIONS OF THE NORTH CAROLINA ADMINISTRATIVE CODE
TITLE DEPARTMENT LICENSING BOARDS CHAPTER
1 Administration Acupuncture 1
2 Agriculture Architecture 2
3 Auditor Athletic Trainer Examiners 3
4 Commerce Auctioneers 4
5 Correction Barber Examiners 6
6 Council of State Certified Public Accountant Examiners 8
7 Cultural Resources Chiropractic Examiners 10
8 Elections Employee Assistance Professionals 11
9 Governor General Contractors 12
10 Health and Human Services Cosmetic Art Examiners 14
11 Insurance Dental Examiners 16
12 Justice Dietetics/Nutrition 17
13 Labor Electrical Contractors 18
14A Crime Control & Public Safety Electrolysis 19
15A Environment and Natural Resources Foresters 20
16 Public Education Geologists 21
17 Revenue Hearing Ad Dealers and Fitters 22
18 Secretary of State Landscape Architects 26
19A Transportation Landscape Contractors 28
20 Treasurer Massage & Bodywork Therapy 30
*21 Occupational Licensing Boards Marital and Family Therapy 31
22 Administrative Procedures (Repealed) Medical Examiners 32
23 Community Colleges Midwifery Joint Committee 33
24 Independent Agencies Mortuary Science 34
25 State Personnel Nursing 36
26 Administrative Hearings Nursing Home Administrators 37
27 NC State Bar Occupational Therapists 38
Opticians 40
Optometry 42
Osteopathic Examination & Reg (Repealed) 44
Pastoral Counselors, Fee-Based Practicing 45
Pharmacy 46
Physical Therapy Examiners 48
Plumbing, Heating & Fire Sprinkler Contractors 50
Podiatry Examiners 52
Professional Counselors 53
Psychology Board 54
Professional Engineers & Land Surveyors 56
Real Estate Appraisal Board 57
Real Estate Commission 58
Refrigeration Examiners 60
Sanitarian Examiners 62
Social Work Certification 63
Soil Scientists 69
Speech & Language Pathologists & Audiologists 64
Substance Abuse Professionals 68
Therapeutic Recreation Certification 65
Veterinary Medical Board 66
Note: Title 2 1 contains the chapters of the various occupational licensing boards.
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ON
EXECUTIVE ORDERS
EXECUTIVE ORDER NO. 167
EMERGENCY RELIEF FOR DAMAGE
CAUSED BY JANUARY 2000 WINTER STORM
WHEREAS, I have proclaimed that a state of emergency and
disaster exists in North Carohna due to a winter storm; and
WHEREAS,, the North Carolina Department ofTransportation
has declared a State emergencyjustifying an exemption from 49
C.F.R. 390-397 (Federal Motor Carrier Safety Regulations); and
WHEREAS, under the provisions of N.C.G.S. 1 66A-4(3) and
166A-6(c)(3), the Governor, with the concurrence of the
Council of State, may regulate and control the flow of vehicular
traffic and the operation of transportation services; and
WHEREAS, with the concurrence of the Council of State, I
have found that if vehicles carrying salt to alle\'iate slippery
conditions on ice-covered streets, roads and highways and
equipment used to restore pubhc utilities must adhere to the
registration requirements of N.C.G.S. 20-86. 1 and 20- 382, fiiel
tax requirements of N.C.G.S. 105-449.47, and the size and
weight requirements of N.C.G.S 20-1 16 and N C.G.S. 20-1 18,
then streets, roads and highways will not be cleared of slippery
conditions in an expeditious manner and this will result in an
imminent threat of widespread damage within the meaning of
N.C.G.S. 166-A-4(3);
NOW, THEREFORE, pursuant to the authority vested in me
as Governor by the Constitution and the laws of the State of
North Carohna, and with the concurrence of the Council of
State, IT IS ORDERED:
Section h The Division of Motor Vehicles shall waive
certain size and weight restrictions and penalties therefore
arising under N.C.G.S. 20- 1 1 6 and N.C.G.S. 20- 11 8, and certain
registration requirements and penalties therefore ansing under
N.C.G.S. 20-86 1,20-382, 105-449 47, 105-449.49 for vehicles
transporting salt, and equipment used to restore public utilities,
along our streets, roads and highways to North Carolina's winter
storm stricken counties.
temporary trip permit is waived for the vehicles
described above. No quarterly fiiel tax is required
because the exception m N.C.G.S. 105-449.45(a)(I)
applies.
(B) The registration requirement under N.C.G S. 20-382
concerning intrastate and interstate for-hire authority
is waived; however, vehicles shall maintain the
required limits of insurance.
(C) Non-participants in North Carolina's International
Registration Plan will be permitted into North
Carolina in accordance with the spirit of the
exemptions identified by this Executive Order.
Section 4^ Thesizeandweight exemption for vehicles will
be allowed on all routes designated by the North Carolina
Department of Transportation. This order shaU not be in effect
on bridges posted pursuant to N.C.G.S. 136-72.
Section s. The waiver ofregulations under 49 C.F.R. 390-
397 (Federal Motor Carrier Safety Regulations) does not apply
to the CDL and Insurance Requirements This waiver shall be
in effect for 30 days or for the duration of the emergency,
whichever is less.
Section 6. The North Carolina Department of
Transportation shall enforce the conditions set forth in Sections
1, 2, and 3 in a manner which will best accomplish the
implementation of this rule without endangering motorists in
North Carolina.
Section T Upon request, exempted vehicles shall be
required to produce identification sufficient to establish that its
load consists of salt and equipment used to restore public
utihties which will be used for emergency relief efforts
associated with the January 2000 winter storm and the
alleviation of slippery conditions along North Carolina streets,
roads and highways.
This Executive Order is effective immediately and shall
remain in effect for thirty (30) days from the date provided
below.
Section Z Notwithstanding the waivers set forth above,
size and weight restrictions and penalties have not been waived
under the following conditions;
( A) When the vehicle weight exceeds the maximum gross
weight critena established by the manufacturer
(GVWR) or 90,000 pounds gross weight, whichever
is less.
(B) When the tandem axle weight exceeds 42,000 pounds
and the single axle weight exceeds 22,000 pounds.
(C) When a vehicle/vehicle combination exceeds 12 feet
in width and a total overall vehicle combination
length of 75 feet from bumper to bumper.
Done in the Capital City of Raleigh, North Carolina this 28th
day of January, 2000.
Section 3^ Vehicles referenced under section 1 shall be
exempt from the following registration requirements
(A) The $50.00 fee listed m N.C.G.S. 105-449 49 for a
14:17 NORTH CAROLINA REGISTER March 1, 2000 1492
INADDITION
This Section contains public notices that are required to be published in the Register or have been approved by the Codifier
ofRulesfor publication.
CHAPTER 63 - SOCIAL WORK CERTIFICATION
NOTICE OF PUBLIC HEARING
The North Carolina Social Work Certification and Licensure Board ("Board") will hold an additional public hearing to take
comment on proposed permanent rules. The Board published a Notice ofText in Volimie 14, Issue 14 ofthe North Carolina Register
indicating its intent to adopt, amend and repeal rules located at Title 2 1 , Chapter 63 ofthe North Carolina Administrative Cocfe. That
Notice of Text included notice of a public hearing which was held on February 7, 2000. It also included notice that the comment
period mandated by G.S. 1 50B-2 1 .2(f) would run through February 14, 2000. The Board will hold an additional public hearing on
March 16, 2000. The hearing will begin at 9:00 a.m., and will be held in Room G-22 of the OldEducation Building, 1 14 W. Edenton
St., Raleigh, North Carolina. Pursuant to G.S. 150B-2 1.2(f) the Board will hold open the comment period through March 16, 2000.
Questions regarding the public hearing and any written comments on the proposed rules should be directed to Grady L. Balentine,
Jr., Assistant Attorney General, N.C. Dept. ofJustice, P.O. Box 629, Raleigh, NC 27602-0629, telephone (919)71 6-6840. The Board
will consider the proposed rules at a meeting on March 17, 2000, by conference telephone. Anyone wishing to listen to the March
17, 2000 meeting should contact the Board Office at (336) 625-1679.
1493 NORTH CAROLINA REGISTER March 1,2000 14:17
INADDITION
U.S. Department of Justice
Civil Rights Division
JDR:DHH:DCM:par Voting Section
DJ 1 66-0 1 2-3 PO. Box 66128
1999-1978 Washington, D.C. 20035-6128
1999-2745
January 14, 2000
Robert E. Homik, Jr., Esq.
The Brough Law Firm
1829 East Franklin St., Suite 800-
A
Chapel HiU,NC 275 14
Dear Mr. Homik:
This refers to the June 1, 1969, March 9, 1970, April 26, 1971, annexations, 14 other annexations (Ordinance Nos. 72-1 1,
76-8, 79-5, 79-13, 79-35, 80-37, 80-38, 80-46, 82-14, 82-3 1 , 85-47, 90-16, 99-9,and 99-10), and the designation ofthe annexed areas
to wards of the Town of Tarboro in Edgecombe County, North Carolina, submitted to the Attorney General pursuant to Section 5
of the Voting Rights Act, 42 U.S.C. 1973c. We received your submissions on December 15, 1999.
The Attorney General does not interpose any objection ot the specified changes. However, we note that Section 5 expressly
provides that the failure of the Attorney General to object does not bar subsequent litigation to enjoin the enforcement ofthe changes.
In addition, as authorized by Section 5, we reserve the right to reexamine these submissions if additional information that woJd
otherwise require an objection comes to out attention during the remainder of the sixty-day review period. See the Proceduresfor
the Administt^tion of Section 5 (28 C.F.R. 51.41 and 51.43).
Sincerely,
Joseph D. Rich
Acting Chief, Voting Section
14:17 NORTH CAROLINA REGISTER March 1,2000 1494
INADDITION
U.S. Department of Justice
Civil Rights Division
JDR:DHH:SMC;bab
DJ 166-012-3
1999-3686
1999-3834
Voting Section
P.O. Box 66128
Washington, D.C. 20035-6128
January 14, 2000
David A. Holec, Esq.
City Attorney
P.O. Box 7207
Greenville, NC 27835
Dear Mr. Holec:
This refers to 1 3 annexations (Ordinance Nos. 95 through 103 and 129 through 132 (1999)) and their designation to districts
ofthe City ofGreenville in Pitt County, North Carolina, submitted to the Attorney General pursuant to Section 5 ofthe Voting Rights
Act, 42 U.S.C. 1973c. We received your submissions on November 29 and December 16, 1999.
The Attorney General does not interpose any objection to the specified changes. However, we note that Section 5 expressly
provides that the failure ofthe Attorney General to object does not bar subsequent litigation to enjoin the enforcement ofthe changes.
In addition, as authorized by Section 5, we reserve the right to reexamine these submissions if additional information that would
otherwise require an objection comes to our attention during the remainder ofthe sixty-day review period. See the Proceduresfor
the Administration of Section 5 (28 C.F.R. 51.41 and 51.43).
Sincerely,
Joseph D. Rich
Acting Chief, Voting Section
1495 NORTH CAROLINA REGISTER March 1, 2000 14:17
RULE-MAKING PROCEEDINGS
A Notice ofRule-making Proceedings is a statement ofsubject matter ofthe agency's proposednile making The agency must
publish a notice of the subject matterfor public comment at least 60 days prior to publishing the proposed text ofa rule.
Publication ofa temporary rule serves as a Notice of Rule-making Proceedings and can befound in ihe Register under the
section heading of Temporary Rules. A Rule-making Agenda published by an agency sen'es as Rule-making Proceedings and
can be found in the Register under the section heading ofRule-making Agendas. Statutory reference: G.S. 150B-21.2.
TITLE 10 - DEPARTMENT OF HEALTH AND HUMAN
SERVICES
CHAPTER 3 - FACILITY SERVICES
^ Jotice of Rule-making Proceedings is hereby given by the
1\ NC Child Care Commission in accordance Mith G.S.
150B-21.2. The agency shall subsequently publish in the
Resister the text ofthe rule(s) it proposes to adopt as a result of
this notice of rule-making proceedings and any comments
received on this notice.
Citation to Existing Rules Affected by this Rule-Making:
lONCAC 3U .0300, .0600. .0800. .1300, .1600-.2200 - Other
rules may beproposed in the course ofthe rule-makingprocess.
Authority for the rule-making: G.S. 143B-168.3.
Statement of the Subject Matter: Child care rules regarding
the health and safety of children in child care centers and
homes.
Reason for Proposed Action: The Child Care Commission
proposes rulemaking to review requirements pertaining to the
health and safety of children in child care centers andfamily
child care homes. The Commission will also review rules that
may need updated terminology or references.
Comment Procedures: Questions or written comments
regarding this matter may be directed to Janice Fain, APA
Coordinator, Division ofChildDevelopment. 2201 Mail Service
Center. Raleigh, NC 27699-2201, (919)662-4543.
TITLE 15A - DEPARTMENT OF ENVIRONMENT AND
NATURAL RESOURCES
215.3(a)(1); St. 1999, c. 329.
Statement of the Subject Matter: The proposed rule will set
forth the procedures and requirements for collection system
owners to meet the requirements of S.L. 1999, c. 329. The
proposed rule will also define collection system since this term
is not defined in the statutes. Thefollowing test is the proposed
rule test which the Environmental Management Commission
plans to adopt.
Reason for Proposed Action: On July 20. 1999 the N. C.
General Assembly ratified House Bill 1160. Section 11.2. of
Part .XI, entitled "Environmental Management Commission to
Develop Engineering Standards and Implement a Permit
ProgramforMunicipal andDomestic Wastewater Collections,
"
states, "The Environmental Management Commission shall
develop and implement a permit program for municipal and
domestic wastewater collection systems on a systemwide
basis...the Commission shall implement thepermitprogram over
afive-yearperiod beginning 1 July 2000." The term "collection
system " is not defined in the State 's statutes or administrative
code.
A rule which addresses the scope and requirements ofthe new
permitting program must be added to 15A NCAC 2H .0200 -
"Waste Not Discharged to Surface Waters. " March 1, 2000 has
been selected as the proposed effective date of the temporary
rule so that applications may be distributed, completed, and
returned prior to the initiation ofpermitting on July 1, 2000.
This Rule will define collection system and address the scope
and requirements of the new permitting program. The
temporary rule is intended to become permanent. However,
time does not permit the adoption ofa permanent rule prior to
the mandated implementation date. The Environmental
Management Commission will approve the rule and grant staff
the authority to proceed with temporary and permanent rule
making proceduresfor publication in the NC Register.
CHAPTER 2 - ENVIRONMENTAL MANAGEMENT
TV Jotice ofRule-making Proceedings is hereby given hy the
1 V DENR,'Environmental Management Commission in
accordance with G.S. 150B-21.2 The agency shall
subsequently publish in the Register the text of the rule(s) it
proposes to adopt as a result of this notice of rule-making
proceedings and any comments received on this notice.
Citation to Existing Rules Affected by this Rule-Making:
15A NCAC 2H .0227 - Other rules may be proposed in the
course of the rule-making process.
Comment Procedures: Written comments may be submitted to
Kim H. Colson, Division of Water Quality, Water Quality
Section, Non-Discharge Permitting Unii. 1617 Mail Sen'ice
Center, Raleigh. NC 27699-1617. An information package may
be obtained hy contacting the Non-Discharge Permitting Unit
at (919)733-5083 (EXT. 574 OR 524).
SUBCHAPTER 2H - PROCEDURES FOR
PERMITS: APPROVALS
SECTION .0200 - WASTE NOT DISCHARGED
TO SURFACE WATERS
Authority for the rule-making: G.S 143-215.1; 143- 0227 SYSTEM-WIDE COLLECTION SYSTEM
14:17 NORTH CAROLINA REGISTER March 1, 2000 1496
RULE-MAKING PROCEEDINGS
PERMITTING
(a) In accordance with the North Carolina Clean Water Act
of 1999. S, L 1999 a 329, s, 11.2. the Director may issue
system-wide permits for collection systems.
(b) The following definitions apply to this Section:
(1) "Collection system" means a group of contiguous
sewer systems that convey municipal or domestic
wastewater to a wastewater treatment facility or
separately-owned sewer system.
(2) "High-priority sewer line" means any aerial line, sub-waterway
crossing, line contacting surface waters,
siphon. Une positioned parallel to streambanks that
are subject to eroding in such a manner that may
threaten the sewer line, or line designated as high
priority in a permit.
(c) Permit apphcations for the initial issuance of a collection
system permit shall be completed and submitted to the Division
within 60 days of the collection system owner's receipt of the
Division's request for application submittal. The Division shall
request the initial application submittal by certified mail. Permit
renewal requests shall be submitted to the Director at least 1 80
days prior to expiration, unless the permit has been revoked in
accordance with Rule .0213 of this Section. All applications
must be submitted in triplicate and made on official forms
completely filled out, where applicable, and fully executed.
(d) Collection systems that have a design flow and convey an
actual flow less than 200.000 gallons per day shall be deemed to
be permitted pursuant to G.S. 143-2 1 5. l(b)(4)e. and it shall not
be necessary for the Division to issue individual permits for the
operation and maintenance of the these systems and their
associated management programs provided that the following
criteria are met:
(1) The sewer system is effectively maintained and
operated at all times to prevent discharge to land or
surface waters, and any contravention of the
groundwater standards in 1 5A NCAC 2L .0200 or the
surface water standards in 15A NCAC 2B .0200;
(2) A map of the sewer system has been developed prior
to January 1. 2004 and is actively maintained;
£3} An operation and maintenance plan has been
developed and implemented;
(4) Pump stations that are not connected to a telemetry
system are inspected at least three times per week
until July L, 2000; thereafter, pump stations are
inspected at least daily, as defined in 15A NCAC 2B
.0503(5). until July L 2001; and thereafter, pump
stations are inspected every day. Pump stations that
are connected to a telemetry system are inspected at
least once per week;
(5) High-priority sewer lines are inspected at least once
per every six-month period of time;
(6) A general observation of the entire sewer system is
conducted at least once per year;
(7) Inspection and maintenance records are maintained
for a period of at least three years; and
(8) Overflows and bypasses are reported to the
appropriate Division regional office in accordance
with 15A NCAC 2B .0506(a). and public notice is
provided as required by G.S. 143-2 15. IC.
£e) The Director may, on a case by case basis, determine that
a collection system should not be deemed to be permitted in
accordance with this Rule and require the owner of the
collection system to obtain an individual collection system
permit from the Division if
(1) The owner of the collection system does not maintain
compliance with the requirements ofParagraph (d) of
this Rule; or
("2") The collection system is determined to be
contributing to the impairment of surface waters
specified on the Division's list generated as a result of
the Federal Water Pollution Control Act (Clean Water
Act) Section 303(d). 33 U.S.C. Section 1313(dy
Authority G.S. 143-215. 1(a); 1 43-2 15.3 (a), (d); North Carolina
Clean Water Act of 1999, S.L 1999 c. 329.
TITLE 16 - DEPARTMENT OF PUBLIC EDUCATION
CHAPTER 6 - ELEMENTARY AND SECONDARY
EDUCATION
A Totice ofRule-making Proceedings is hereby given by the
ly State Board of Education in accordance with G.S.
150B-21.2. The agency shall subsequently publish in the
Resister the text ofthe rule(s) itproposes to adopt as a result of
this notice of rule-making proceedings and any comments
received on this notice.
Citation to Existing Rules Affected by this Rule-Making:
1 6 NCAC 6C. 0401, .0404, .0501 -Other rules may beproposed
in the course of the rule-making process.
Authority for the rule-making: G.S 115-12(8), 115-272, 115
-285, 115-302.1, 115-316, 115-333, 115-408
Statement of the Subject Matter: Local school employee
leave provisions and evaluation.
Reason for Proposed Action: These rule-makingproceedings
were initiated by the State Board of Education to make
clarifying amendments to school personnel leave policies and
to update the employee evaluation process.
Comment Procedures: Written comments may be submitted to
Harry E. Wilson, State Board ofEducation, 301 N. Wilmington
St., Raleigh, NC 27601-2625.
TITLE 18 - DEPARTMENT OF SECRETARY OF
STATE
CHAPTER 6 - SECURITIES DIVISION
1497 NORTH CAROLINA REGISTER March 1, 2000 14:17
RULE-MAKING PROCEEDINGS
Notice ofRule-making Proceedings is hereby given by the NC
Department of the Secretary of State in accordance with G.S.
150B-21.2. The agency shall subsequently publish in the
Register the text ofthe rule(s) itproposes to adopt as a result of
this notice of rule-making proceedings and any comments
received on this notice.
Citation to Existing Rules Affected by this Rule-Making: 18
NCAC 6 . 1402, . 1413, . 1 709 Other rules may be proposed in
the course of the rule-making process.
Authority for the rule-making: G.S. 78A-37(a); 78A-39; 78A-
(b)(4); 78A-49(a); 78C-19(b); 78C-30(a); 78-30(b).
Statement of the Subject Matter: These amendments relate to
the examinations required of applicants for registration as
investment advisors, investment advisor representatives, and
securities salesmen. They are intended to implement a uniform
and coordinatedpolicy by state securities regulators developed
andpromoted by the North American Securities Administrators
Association(NASAA).
Reason for Proposed Action: As ofJanuary 1, 2000, NASAA
implemented a revised Uniform Investment Advisor State Law
Examination (known as a Series 65 Exam) and retired the Series
65 Exam contemplated by 18 NCAC 6 .1709 that was in use
prior to that date. Additionally, as ofJanuary 1, 2000, NASAA
requires that a person desiring to take the Uniform Combined
State Law Examination (known as the Series 66 Exam) to
qualify candidates as both securities agents and investment
adviser representatives mustpass the NASD General Securities
Representative Examination (known as the Series 7 Exam) as a
co-requisite for taking the Series 66 Exam.
Comment Procedures: Comments concerning these rules may
be addressed to David S. Massey, Deputy Securities
Administrator at 300 N Salisbury St., Suite 100, Raleigh, NC
27603, (919) 733-3924. Comments must be received no later
than May 1, 2000.
SECTION .1400 - REGISTRATION OF
DEALERS AND SALESMEN
examination as required by Rule .1413 of this
Section.
(b) The application for registration as a salesman shall be
filed as follows:
(1) NASD member dealers shall file all salesman
applications for registration in the State of North
Carolina with the NASAA/NASD Central
Registration Depository, PrO:—Bcrx
—
37441,
Washington,
—
DC. 20013; P.O. Box 9401.
Gaithersburg. MD 28898-9401.
(2) Non-NASD member dealers shall file all salesman
applications for registration in the State of North
Carolina directly with the Securities Division.
(c) The salesman or the dealer for which the salesman is
registered shall file with the administrator, as soon as practicable
but in no event later than 30 days, notice of any disciplinary
action taken against a salesman by any exchange of which the
dealer is a member; the Securities and Exchange Commission;
the Commodity Futures Trading Commission; any national
securities association registered with the Securities and
Exchange Commission pursuant to Section 1 5A ofthe Securities
Exchange Act of 1934 or any state securities comrmssion and of
any civil suit, warrant, criminal warrant, or criminal indictment
filed against the salesman alleging violation of any federal or
state securities laws. If the information contained in any
document filed with the administrator is or becomes inaccurate
or incomplete in any material respect, the salesman or the dealer
for which the salesman is registered shall file a correcting
amendment as soon as practicable but in no event later than
thirty days. Such filing is to be made by NASD member dealers
and their salesmen to the NASAA/NASD Central Registration
Depository and non-NASD member dealers and their salesmen
shall make such filing directly with the Securities Division.
(d) Registration becomes effective at noon of the 30* day
after a completed application is filed or such earlier time upon
approval of the application by the administrator, unless
proceedings are instituted pursuant to G.S 78A-39. The
administrator may by order defer the effective date after the
filing of any amendment but no later than noon of the 30* day
after the filing of the amendment.
(e) A salesman shall only be registered in this State with one
dealer.
.1402 APPLICATION FOR REGISTRATION OF
SALESMEN
(a) The application for registration as a salesman shall
contam the following:
(1) an executed Uniform Application for Securities and
Commodities Industry' Representative and/or Agent
(Form U-4) or the appropriate successor form;
(2) a fee in the amount of fifty-five dollars ($55.00);
(3) evidence of a passing grade of 70 percent on either:
(A) the Uniform Securities Agent S^ate Law
Examination (USASLE-Series 63), or
(B) both the Uniform Combined State Law
Examination (Series 66 Exam) and the General
Securities Representative Exammation (Series
2 Exam), as well as the appropriate NASD
AuthorityG.S. 78A-37(a); 78A-37(b); 78A-38(c); 78A-39(b)(4);
78A-49(a).
.1413 SALESMAN EXAMINATION REQUIRED
(a) Every application for registration as a salesman shall
show evidence of a minimum passing grade of seventy percent
on either:
(1) the Uniform Securities Agent State Law Examination
(USASLE-Series 63): or
(2) both the Uniform Combined State Law Examination
(Series 66 Exam) and the General Securities
Representative Examination (Series 7 Exam). The
USASLE-Series—-63
—
examinat ion—rs These
examinations are given by the National Association of
Securities Dealers (NASD). Each application for
14:17 NORTH CAROLINA REGISTER March 1, 2000 1498
RULE-MAKING PROCEEDINGS
registration must also show that the apphcant has
passed the appropriate NASD exam apphcable to
apphcants for registration as a securities salesman .
The scheduled dates, times and locations may be
obtained by contacting the NASD, 1735 K Street
Noi'tliwest7~Wasliiugton, D.C. Central Registration
Depository, P.O. Box 9401, Gaithersburg, MD
28898-9401 (202) 728-8800 (301) 590-6500 or the
Securities Division.
(b) The requirement of Paragraph (a) of this Rule shall not
apply to any salesman who has been registered continuously
since April 1 , 1981; provided that a lapse in registration in this
State of less than one year shall not require compliance with
Paragraph (a) of this Rule. New registrants after April 1, 1981,
who have not been registered previously in this State and
previously registered salesmen in this State whose registration
has lapsed for one year or more shall comply with Paragraph (a)
of this Rule.
(c) The administrator may, upon a showing ofluidue haidship
good cause, waive the requirements of Paragraph (a) of this
Rule. For purposes of this Rule, "good cause" for waiver of the
examination requirement is shown by a demonstration that the
applicant's understanding of the ethics and legal guidelines
applicable to securities salesmen is comparable to that shovm by
evidence ofa passing grade on the examination for which waiver
is sought.
(d) Termination ofthe salesman's registration with the NASD
for violation of NASD rules shall automatically terminate the
salesman's registration with the State of North Carolina.
Authority G.S. 78A-39(b)(4); 78A-49(a).
SECTION .1700 - REGISTRATION OF INVESTMENT
ADVISERS AND INVESTMENT ADVISER
REPRESENTATIVES
.1709 EXAMINATIONS FOR INVESTMENT
ADVISERS AND INVESTMENT
ADVISER REPRESENTATIVES
fa)
—
Unless othei-wise waived by th e administrator, an
investment-adviser regi stered or required to be registered under
State Law Examination with a score of 70- or bet t er as a
condit ion of registration as an investment adviser .—If the
inv es tin enl adviser- is not an individual, an offic er (if the
is^a pax tiiei ship) shall take and pass tlus examination:
(b)
Unle ss otherwise waived by the administrator, an
investment adviser representative-registered-or required to be
registered^ Tinder tiie Act shall~take^ and pass the Umfoiin
Inv estment Adviser State Law Examination with a score of 70
percent or better.
(c) Any person who was regi stered as an investment advisei
or investment adviser repres entative in this state as of the
effective date of tliese Rule s shall not be required to take and
pass tlie Uniform Investment Adviser State Law Examination.
fd)
—
An applicant who has taken and passed the Uniform
Inv estment Adviser State Law Examination with ;a score--iofTe
percent or better witliin two years prior to the date the
application is filed with tlie administrator, or at any time if the
applicant has not been inacti v e in tlie inv estment advisory
business for more than two years when the application is filed;
shall not be required to take and pass tlie Uniform Inv es tinenl
Adviser State Law Examination again.
(a) Examination Requirements. A person applying to be
registered as an investment adviser or investment adviser
representative under the Investment Advisers Act shall provide
the Administrator with proof that he or she has obtained a
passing score on either:
(1) The Uniform Investment Adviser Law Examination
(Series 65 Exam); or
(2) The General Securities Representative Examination
(Series 7 Exam) and the Uniform Combined State
Law Examination (Series 66 Exam).
In the event the applicant for registration as an investment
adviser is an entity, rather than an individual, the examination
shall be taken on behalf of the applicant by one of its officers, a
general partner, a manager, or other managing executive of
comparable status and position.
(b) Grandfathering. An individual who has not been
registered in any jurisdiction for a period of two years shall be
required to comply with the examination requirements of
Paragraph (a) of this Rule.
(c) Waivers. The examination requirement shall not apply to
an individual who currently holds one of the following
professional designations:
(1) Certified Financial Planner (CFP) awarded by the
International Board of Standards and Practices for
Certified Financial Planners. Inc.;
(2) Chartered Financial Consultant (ChFC) awarded by
the American College. Bryn Mawr. Pennsylvania;
(3) Personal Financial Specialist (PFS) awarded by the
American Institute of Certified Public Accountants;
(4) Chartered Financial Analyst (CFA) awarded by the
Institute of Chartered Financial Analysts;
(5) Chartered Investment Counselor (CIC) awarded by
the Investment Counsel Association ofAmerica. Inc.;
or
(6) Such other professional designation as the
Administrator may by order recognize.
Authority G.S. 78C-19(b)(5); 78C-30(a): 78C-30(b).
1499 NORTH CAROLINA REGISTER March 1, 2000 14:17
PROPOSED RULES
This Section contains the text ofproposed rules. At least 60daysprior to the publication oftext, the agencypublisheda Notice
ofRule-making Proceedings. The agency must accept comments on theproposed rulefor at least 30 daysfrom the publication
date, or until the public hearing, or a later date ifspecified in the notice by the agency. The required comment period is 60
daysfor a rule that has a substantial economic impact ofat leastfive million dollars ($5,000,000). Statutory reference: G.S.
150B-21.2.
TITLE 10 - DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Notice is hereby given in accordance with G S. 1508-21.
2
that the DHHS - Division ofMedical Assistance intends to
amend rules cited as 10 NCAC 26B 0113. 26H .0304 and
repeal the rules cited as 10 NCAC 26M .0301-.0305. Notice of
Rule-making Proceedings was published in the Register on
August 16, 1999for 10 NCAC 26B .01 13; 26M.0301 -.0305 and
on September 1, 1999for 10 NCAC 26H .0304.
Proposed Effective Date: August 1, 2000
A Public Hearing vt'/// Ae conducted at 1:30p.m. on March 21,
2000 at 1985 UmsteadDr., Room 132, Kirby Building, Raleigh,
NC 27603.
Reason for Proposed Action: 10 NCAC 26B .0113, 26M
.0301-.0305 - The action was necessitated by the termination of
the Carolina Alternatives Waiver and the exclusion of state
hospitals as eligible providers.
10 NCAC 26H .0304 - The application of the upper payment
limit is an annual test performed by the Division of Medical
Assistance to assure that the program is in compliance with the
applicablefederal regulations. The review this year ofthe cost
report informationfor the fiscal period ending June 30, 1998,
adjustedforwardfor inflation, would be expected to have a total
ofpayments that would exceed the total ofcost.
Comment Procedures: Written comments concerning this rule-making
action must be submitted by March 31, 2000 to Portia
W. Rochelle, Rule-making Coordinator, Division of Medical
Assistance, 1985 Umstead Drive, 2504 Mail Service Center,
Raleigh, NC 27699-2504.
Fiscal Impact
State Local Sub. None
/ 10 NCAC 26M 0301-0305
10NCAC26B.0113, 26H.0304
CHAPTER 26 - MEDICAL ASSISTANCE
SUBCHAPTER 26B - MEDICAL ASSISTANCE
PROVIDED
SECTION .0100 - GENERAL
.01 13 NC MEDICAID CRITERIA FOR CONTINUED
ACUTE STAY IN AN INPATIENT
PSYCHIATRIC FACILITY
The following criteria apply to individuals under the age of2
1
in a psychiatric hospital or in a psychiatric unit of a general
hospital, and to individuals aged 21 through 64 receiving
treatment in a psychiatric unit of a general hospital These
criteria shall be applied after the initial admission period of up
to three days. To qualify for Medicaid coverage for a
contmuation of an acute stay in an inpatient psychiatric facility
a patient must meet each of the conditions specified in Items ( 1
)
through (4) of this Rule. To qualify for Medicaid coverage for
continued post-acute stay in an inpatient psychiatric facility a
patient must meet all of the conditions specified in Item (5) of
this Rule.
( 1
)
The patient has one of the following:
(a) A current DSM-IV, Axis I diagnosis; or
(b) A current DSM-IV, Axis II diagnosis and
current symptoms/behaviors which are
characterized by all of the following:
(i) Symptoms/behaviors are likely to
respond positively to acute inpatient
treatment; and
(ii) Symptoms/behaviors are not
characteristic of patient's baseline
fxinctioning; and
(iii) Presenting problems are an acute
exacerbation of dysfunctional behavior
patterns which are recurring and
resistive to change.
(2) Symptoms are not due solely to mental retardation;
(3) The symptoms of the patient are characterized by:
(a) At least one of the following:
(i) Endangerment of self or others; or
(ii) Behaviors which are grossly bizarre,
disruptive, and provocative (e.g. feces
smearing, disrobing, pulling out hair); or
(iii) Related to repetitive behavior disorders
which present at least five times in a 24-
hour period, or
(iv) Directly result in an inabihty to maintain
age appropriate roles; and
(b) The symptoms of the patient are characterized
by a degree of intensity sufficient to require
continual medical/nursing response,
management, and monitoring.
(4) The services provided in the facility can reasonably
be expected to improve the patient's condition or
prevent ftuther regression so that treatment can be
continued on a less intensive level ofcare, and proper
treatment of the patient's psychiatric condition
requires services on an inpatient basis under the
direction of a physician.
(5) Exceprt—for—patients—receiving services—through
Cai'oliua Alteruatires and except t
14:17 NORTH CAROLINA REGISTER March 1, 2000 1500
PROPOSED RULES
hospitals where the discliarge requirement s ai e set out
in 10 NCAC 15A, iii In the event that not all of the
requirements specified in Items ( 1 ) through (4) ofthis
Rule are met, reimbursement may be provided for
patients through the age of 1 7 for continued stay in an
inpatient psychiatric facihty at a post-acute level of
care to be paid at the High Risk Intervention
Residential High (HRI-R High) rate ifthe facility and
program services are appropriate for the patient's
treatment needs and provided that all of the following
conditions are met:
(a) The psychiatric facihty has made a referral for
case management and after care services to the
area Mental Health, Developmental
Disabilities, Substance Abuse (MH/DD/SA)
program which serves the patient's county of
eligibihty.
(b) The area MH/DD/SA program has found that
no appropriate services exist or are accessible
within a clinically acceptable waiting time to
treat the patient in a community setting.
(c) The area MH/DD/SA program has agreed that
the patient has a history of sudden
decompensation or significant regression and
experiences weakness in his or her
environmental support system which are likely
to trigger a decompensation or regression.
This history must be documented by the
patient's attending physician.
(d) The inpatient facility must have a contract to
provide HRI-R, High with the area MH/DD/SA
program which serves the patient's county of
eligibility, or the area program's agent.
Psychiatric hospitals or psychiatric units in
general hospitals are eligible to establish
contract relationships with all non-Carolina
Alternatives area MH/DD/SA programs or
their agents in accordance with statutory
procedures as defined in G.S. 122C-142.
(e) The Child and Family Services Section of the
Division of Mental Health, Developmental
Disabilities, Substance Abuse Services shall
approve the use of extended HRI-R, High,
based on criteria in Sub-items (a)-(c) of this
Item.
(f) The area MH/DD/SA program shall approve
the psychiatric facility for the provision of
extended HRI-R High, receive claims fi^om the
inpatient facility, and provide reimbursement
to the facility in accordance with the terms of
its contract.
NOTE:
.0304
The bold text reflects the changes which were
approved by the Rules Review Commission and is
waiting for Legislative Session 2000.
RATE SETTING METHOD FOR NON-STATE
FACILITIES
(a) A prospective rate shall be determined annually for each
non-state facility to be effective for dates of service for a 12
month rate period beginning each July 1 . The prospective rate
shall be paid to the provider for every Medicaid eligible day
during the applicable rate year. The prospective rate may be
determined after the effective date and paid retroactively to that
date. The prospective rate may be
changed due to a rate appeal under Rule .0308 ofthis Stale Plan
Section or facility reclassification under Paragraph (b) of this
Rule. Each non-state facihty, except those facilities where
Paragraph (v) of this Rule applies, shall be classified into one of
the following groups:
(1) Group 1- Facilities with 32 beds or less.
(2) Group 2- Facilifies with more than 32 beds.
(3) Group3-Facilities with medically fragile clients. For
rate reimbursement purposes under this Rule
medically fragile clients are defined as any individual
with complex medical problems who have chronic
debilitating diseases or conditions of one or more
physiological or organ systems which generally make
them dependent upon 24-hour a day
medical/nursing/health supervision or intervention.
(4) Facilifies in group 1 or 2 in Subparagraph (a)(1) or (2)
of this Rule shall be fiirther classified in accordance
to the level of disability of the facility's clients, as
measured by the Developmental Disabilities Profile
(DDP) copyrighted assessment instrument which
along with the scoring instrument are hereby
incorporated by reference, including subsequent
amendments and editions. This material is available
for inspection and copies may be obtained from the
Division ofMedical Assistance, 1985 Umstead Drive,
Raleigh, North Carolina 27603 at a cost of twenty
cents ($.20) per page. A summary of the levels of
disability is shown in the following chart:
FACILITY DDP SCORE
Level Low
1 200.00
2 125.00
3 100.00
4 75.00
5 50.00
High
300.00
199.99
124.99
99.99
74.99
AuthorityG.S. l08A-25(h); 108A-54: 42C.F.R. 441 Subpart D.
SUBCHAPTER 26H - REIMBURSEMENT PLANS
SECTION .0300 - ICF-MR PROSPECTIVE RATE PLAN
(b) Facilifies shall be reclassified into appropriate groups as
defined in Paragraph (a) of this Rule.
(1) When a facility is reclassified, the rate shall be
adjusted retroactively back to the date of the event
that caused the reclassification. This adjustment shall
give fiill consideration to any reclassification based
1501 NORTH CAROLINA REGISTER March 1, 2000 14:17
PROPOSED RULES
on the change in facts or circumstances during the
year. Overpayments related to this retroactive rate
adjustment shall be repaid to the Medicaid program.
Underpayments related to this retroactive rate
adjustment shall be paid to the provider.
(2) The provider shall be given the opportunity to appeal
the merits of the reclassification of any facility, prior
to any decision by the Division of Medical
Assistance.
(3) The provider shall be notified in writing 30 days
before the implementation ofnew rates resulting from
the reclassification of any facihty.
(4) The providers and the Division of Medical Assistance
shall make every reasonable effort to ensure that each
facility is properly classified for rate setting piuposes.
(5) A provider shall file any request for facility
reclassification in writing with the Division of
Medical Assistance no later than 60 days subsequent
to the proposed reclassification effective date.
(6) For facilities certified prior to July 1, 1993, the
facility DDP score calculated for fiscal year 1993
shall be used to estabhsh proper classification at July
1, 1995.
(7) For facihties certified after June 30, 1993, the most
recent facility DDP score shall be used to establish
proper classification.
(8) A facility reclassification review shall use the most
current facility DDP score.
(9) A facility's DDP score shall be subject to independent
vaUdation by the Division of Medical Assistance.
(10) A new facility that has not had a DDP survey
conducted on its clients shall be categorized as a level
2 facility for rate setting purposes, pending
completion of the DDP survey. Upon completion of
the DDP survey, the facility shall be subject to
reclassification and rates shall be adjusted
retroactively back to the date of certification.
Overpayments related to this retroactive adjustment
shall be paid to the Medicaid program.
Underpayments related to this retroactive rate
adjustment shall be paid to the provider,
(c) Facility rates under this Rule shall be estabhshed at July
1, 1995, under the following:
(1) For facilities certified prior to July 1, 1993, rates shall
be derived from the 1993 cost reports.
(2) For facilities certified during fiscal year 1993-1994,
the fiscal year 1994 facility specific cost report shall
be used to derive rates.
(3) For facihties certified during fiscal year 1994-1995,
the fiscal year 1995 facility specific cost report shall
be used to derive rates.
(A) Rates for these facilities shall not be adjusted,
except for the impact of inflation under
Paragraph (k) of this Rule, until the fiscal year
1995 cost report has been properly reviewed.
Rates for these facilities shall be adjusted
retroactively back to July 1, 1995, once the
fiscal year 1 995 facility specific cost report has
been properly reviewed. Overpayments
related to this retroactive rate adjustment shall
be repaid to the Medicaid program.
Underpayments related to this retroactive rate
adjustment shall be paid to the provider.
(4) Facilities with rates established during a rate appeal
proceeding with the Division of Medical Assistance
during fiscal years 1994 or 1995 shall not have their
rates established in accordance with Subparagraph
(c)(1), (c)(2), or (c)(3) of this Rule
(2^ The rates for these facilities shall remain at the
level approved in the rate appeal proceeding
adjusted only for inflation, as reflected in
Paragraph (k) of this Rule.
(d) For facilities certified after June 30, 1993, rates developed
from filed cost reports for fiscal years subsequent to 1 993 may
be retroactively adjusted if there is found to exist more than a
two percent difference between the filed per diem cost and
either the desk audited or field audited per diem cost for the
same reporting period. Rates developed from desk audited cost
reports may be retroactively adjusted if there is found to exist
more than a two percent difference between the desk audited per
diem cost and the field audited per diem cost for the same
reporting period. The rate adjustment may be made after written
notification to the provider 30 days prior to implementation of
the rate adjustment.
(e) Each prospective rate developed in accordance with
Subparagraph (c)(1), (c)(2), or (c)(3) ofthis Rule consists ofthe
sum of two components as follows:
( 1
)
Indirect care rate.
(2) Direct care rate.
(f) A uniform industry wide indirect care rate shall be
estabhshed for each facihty category shown under Subparagraph
(a)(1), (a)(2), or (a)(3) of this Rule.
( 1
The indirect rate for group 1 facilities is based on the
fiftieth percentile of the following costs incurred by
all group 1 facilities with six beds or less, except
those related by common ownership or control to
more than 40 said facilities:
(A) The sum of the cost of property ownership and
use, administrative and general, and operation
and maintenance ofplant, as determined by the
Myers and Stauffer study performed on the
1993 base year cost reports.
(2) The indirect rate for group 2 facilities is based on the
fiftieth percentile of the costs noted in Part (0( 1 )fA)
of this Rule incurred by the group 2 facilities, as
determined by the Myers and Stauffer study
performed on the 1 993 base year cost reports
(3) The indirect rate for group 3 facilities is based on the
fiftieth percentile of the costs noted in Part (f)( 1 )(A)
of this Rule incurred by the group 3 facilities as
determined by the Myers and Stauffer study
performed on the 1993 base year cost repons
(4) The indirect rates established under Subparagraphs
(0( ! ), (f)(2), and (f)(3) of this Rule shall be reduced
as determined based on industry cost analysis by an
amount not to exceed four percent to account for
14:17 NORTH CAROLINA REGISTER March 1, 2000 1502
PROPOSED RULES
expected operating efficiencies,
(g) The direct care rate for facilities certified prior to July 1,
1993, shall be based on the Myers and Stauffer study performed
on the 1993 base year cost reports.
( 1
)
The direct care rate for all facilities certified during
fiscal years subsequent to fiscal year 1 993 is based on
the first facility specific cost report filed after
certification. Based on said cost report, the direct
care rate is equal to the sum of all allowable costs
reflected in the ICF-MR cost report cost centers, as
included in the ICF-MR cost report format effective
July 1, 1993, except for the following indirect cost
centers:
(A) Property Ownership and Use
(B) Operation and Maintenance of Plant and
Housekeeping-Non-Labor
(C) Administrative and General
(2) The direct care rate shall be limited to the lesser of
the actual amount incurred in the base year or the cost
limit derived fi-om the fiftieth percentile of direct care
costs incurred by the related facihty group in the
fiscal year 1 993 base year, based on the Myers and
Stauffer study.
(3) The fiftieth percentile cost limit shall be reduced by
one percent each year, for the four year period
beginning July 1, 1996, in order to account for
expected operating efficiencies, as determined based
on industry cost analysis.
(4) The fiftieth percentile cost limit shall be increased
each year by price level changes calculated in
accordance with Paragraph (k) of this Rule.
(h) The indirect rate shall not be subject to cost settlement.
( 1
Costs above the indirect rate shall not be paid to the
provider.
(2) Costs savings below the indirect rate shall not be
recouped fi^om the provider.
(i) The direct care rate shall be subject to cost settlement,
based on the cost report, subject to audit, filed with the Division
of Medical Assistance.
( 1
Costs above the direct rate shall not be paid to the
provider.
(2) Cost savings below the direct rate shall be recouped
fi"om the provider.
(j) Facilities with rates estabhshed during a rate appeal
proceeding with the Division ofMedical Assistance during fiscal
years 1994 or 1995 may choose to cost settle under the
provisions of Paragraphs (h) and (i) of this Rule, or under the
following procedure:
( 1
)
If, during a cost reporting period, total allowable costs
are less than total prospective payments, then a
provider may retain one-half of said difference, up to
an amount of five dollars ($5.00) per pafient day. The
balance of unexpended payments shall be refunded to
the Division of Medical Assistance. Costs in excess
of a facility's total prospective payment rate are not
reimbursable.
(2) The facilities subject to the this Paragraph shall make
the election on cost settlement methodology on or
before the filing of the annual cost report with the
Division of Medical Assistance
(3) An election to follow the cost settlement procedures
of Paragraphs (h) and (i) of this Rule shall be
irrevocable.
(4) Rates established for these facilities during future rate
appeal proceedings shall be subject to the cost
settlement procedures ofParagraphs (h) and (i) ofthis
Rule.
(k) To compute each facility's current prospective rate, the
direct and indirect rates established by Paragraphs (f) and (g) of
this Rule shall be adjusted for price level changes since the base
year. No inflation factor for any provider shall exceed the
maximum amount permitted for that provider by federal or state
law and regulations.
(1) Price level adjustment factors are computed using
aggregate costs in the following manners:
(A) Costs shall be separated into three groups:
(i) Labor,
(ii) Non-labor,
(iii) Fixed.
(B) The relative weight of each cost group is
calculated to the second decimal point by
dividing the total costs of each group (labor,
nonlabor, and fixed) by the total cost of the
three categories.
(C) Price level adjustment factors for each cost
group shall be established as follows:
(i) Labor. The percentage change for labor
costs is based on the projected average
hourly wage of North Carolina service
workers. Salaries for all personnel shall
be hmited to levels of comparable
posirions in state owned facilities or
levels specified by the Division of
Medical Assistajice. Assistance based
upon market analysis.
(ii) Nonlabor. The percentage change for
nonlabor costs is based on the projected
annual change in the implicit price
deflator for the Gross National Product
as provided by the North Carolina
Office of State Budget and
Management.
(iii) Fixed. No price level adjustment shall
be made for this category.
(D) The weights computed in Part (k)( 1 )(B) ofthis
Rule shall be multiplied by the rates computed
in Part (kX 1 )(C) of this Rule. These weighted
rates shall be added to obtain the composite
inflation rate to be applied to both the direct
and indirect rates.
(2) Ifnecessary, the Division ofMedical Assistance shall
adjust the annual inflation factor in order to prevent
payment rates fi"om exceeding upper payment limits
established by Federal Regulations.
(1) Effective July 1, 1995, any rate reductions resulting from
this State-Ptan Rule shall be implemented based on the
1503 NORTH CAROLINA REGISTER March 1, 2000 14:17
PROPOSED RULES
following deferral methodology:
( 1
)
Rates shall be reduced for the excess of current rates
over base year costs plus inflation.
(2) Rates shall be reduced a maxmium of 50 percent of
the fiscal 1996 inflation rate for the excess of actual
costs over applicable cost limits. This reduction shall
result in the facility receiving at a minimum 50
percent of the 1996 inflation rate. Any excess
reduction shall be earned forward to fiiture years.
(3) Total reduction in future years related to the excess
reduction carried forward from Subparagraph (1)(2) of
this Rule, shall not exceed tJie annual rate of inflation.
This reduction shall result in the facility receiving at
a minimum the rate established in Paragraph (!)(2) of
this Rule. Any excess reduction shall be carried
forward to future years, until the established rate
equals that generated by Paragraphs (f), (g), and (k)
of this Rule.
(4) Rates calculated based on Subparagraphs (1)(2) and
(3) of this Rule shall be cost settled based on the
provisions of Subparagraph (j)(l) of this Rule until
the fiscal year that the facility receives fiill price level
increase under Paragraph (k) of this Rule.
(A) A provider may make an irrevocable election
to cost settle under the provisions of
Paragraphs (h) and (i) of this Rule during the
deferral period.
(B) Once the rates calculated based on
Subparagraphs (1)(2) and (3) ofthis Rule reach
the fiscal year that the facility receives the full
price level increase under Paragraph (k) ofthis
Rule, then said fiscal year's rates shall be cost
settled based on Paragraphs (h) and (i) of this
Rule.
(C) Chain providers are allowed to file combined
cost reports, for cost settlement purposes, for
facilities that use the same cost settlement
methodology and have the same uniform rate.
(D) A provider may request from the Division of
Medical—Assistance permission elect to
continue cost settlement under Subparagraph
G)(l) of this Rule after the deferral period
expires. Said request election shall be made
each year, 30 days prior to the cost report due
date.
(m) The initial rate for facilities that have been awarded a
Certificate of Need is established at the lower of the fair and
reasonable costs m the provider's budget, as determined by the
Division of Medical Assistance, or the projected costs in the
provider's Certificate of Need application, adjusted from the
projected opening date in the Certificate of Need application to
the current rate period in which the facility is certified based on
the pnce level change methodology set forth in Paragraph (k) of
this Rule, or the rate currently paid to the owning provider, if the
provider currently has an approved chain rate for facilities in the
related facility category. The rate may be rebased to the actual
cost incurred m the first fiill year of normal operations in the
year an audit of the first year of normal operanon is completed.
( 1
)
In the event of a change in ownership, the new owner
receives no more than the rate ofpayment assigned to
the previous owner.
(2) Except in cases wherein the provider has failed to file
supporting information as requested by the Division
of Medical Assistance, initial rates shall be granted to
new enrolled facilities no later than 60 days from the
provider's fihng of properly prepared budgets and
supporting information.
(3) The initial rate for a new facility shall be applicable to
all dates of service commencing with the date the
facility is certified by the Medicaid Program.
(4) The initial rate for a new facility shall not be entered
into the Medicaid payment system until the facility is
properly enrolled in the Medicaid program and a
Medicaid identification number has been assigned to
the facility by the Division of Medical Assistance.
(n) A provider with more than one facility may be allowed to
recover costs through a combined uniform rate for all facilities.
( 1
Combined uniform rates for chain providers shall be
approved upon written request fi"om the provider and
after review by the Division of Medical Assistance.
(2) In determining a combined uniform rate for a
particular facility group, the weighted average ofeach
facility's rate, calculated in accordance to all other
provisions of this Rule, shall be used.
(3) A chain provider with facility(s) that fall under
Paragraphs (h) and (i) of this Rule and with facihty(s)
that fall under Subparagraph (1)(4) of this Rule may
elect to include the facilities in a combined cost report
and elect to cost settle under either Paragraphs (h)
and (i) or Subparagraph (1)(4) of this Rule. The cost
settlement election shall be made each year, 30 days
prior to the cost report due date.
(o) Each out-of-state provider shall be reimbursed at the
lower of the applicable North Carolina rate, as established by
this plan Rule for in-state facilities, or the provider's per diem
rate as established by the state in which the provider is located.
An out-of-state provider is defined as a provider that is enrolled
in the Medicaid program of another state and provides ICF-MR
services to a North Carolina Medicaid client in a facility located
in the state of enrollment. Rates for out-of-state providers are
not subject to cost settlement.
(p) Under no circumstances shall the Medicaid per diem rate
exceed the private pay rate of a facility.
(q) Should the Division of Medical Assistance be unable to
establish a rate for a facility, based on this Rule and the
apphcable facts known, the Division of Medical Assistance may
approve an interim rate.
(1) The intenm rate shall not exceed the rate cap
established under this Rule for the applicable facility
group.
(2) The interim rate shall be replaced by a permanent
rate, effective retroactive to the commencement ofthe
interim rate, by the Division of Medical Assistance,
upon the determination of said rate based on this Rule
and the applicable facts.
(3) The provider shall repay to the Division of Medical
14:17 NORTH CAROLINA REGISTER March 1, 2000 1504
PROPOSED RULES
Assistance any overpayment resulting from the
interim rate exceeding the subsequent permanent rate.
(r) In addition to the prospective per diem rate developed
under this Rule, effective July 1, 1992, an interim payment add
on shall be applied to the total rate to cover the estimated cost
required under Title 29, Part 1910, Subpart 2, Rule 1910,1030
of the Code of Federal Regulations. The interim rate shall be
subject to final settlement reconcihation with reasonable cost to
meet the requirements of Rule 1910 1030. The final settlement
reconciliation shall be effectuated during the annual cost report
settlement process. An interim rate add on to the prospective
rate shall be allowed, subject to final settlement reconciliation,
in subsequent rate periods until cost history is available to
include the cost of meeting the requirements of Rule 1910. 1030
in the prospective rate. This interim add on shall be removed,
upon 10 days written notice to providers, should it be
determined by appropriate authorities that the requirements
under Title 29, Part 1910, Subpart 2, Rule 1910.1030 of the
Code of Federal Regulations do not apply to ICF-MR iacihties.
(s) All rates, except those noted otherwise in this Rule,
approved under this Rule are considered to be permanent.
(t) In the event that the rate for a facility caimot be developed
so that it shall be effective on the first day ofthe rate period, due
to the provider not submitting the required reports by the due
date, the average rate for facilities in the same facility group, or
the facility's current rate, whichever is lower, shall be in effect
until such time as the Division of Medical Assistance can
develop a new rate.
(u) When the Division ofMedical Assistance develops anew
rate for a facility for which a rate was paid in accordance with
Paragraph (t)of this Rule, the rate developed shall be effective
on the first day of the second month following the receipt by the
Division of Medical Assistance of the required reports. The
Division of Medical Assistance may, upon its own motion or
upon application and jnst cause related to patient care shown
by the provider, within 60 days subsequent to submission of the
delinquent report, make the rate retroactive to the beginning of
the rate period in question. Any overpayment to the provider
resulting from this temporary rate being greater than the final
approved prospective rate for the faciUty shall be repaid to the
Medicaid Program.
(v) ICF-MR facilities meeting the requirements of the North
Carolina Division ofFacility Services as a facility affiliated with
one or more of the four medical schools in the state and
providing services on a statewide basis to childien with various
developmental disabihties who are in need of long-term high
acuity nursing care, dependent upon high technology machines
(i.e. ventilators and other supportive breathing apparatus)
monitors, and feeding techniques shall have a prospective
payment rate that approximates cost of care. The payment rate
may be reviewed periodically, no more than quarterly, to assure
proper payment. A cost settlement at the completion of the
fiscal period year end is requu'ed. Payments in excess of cost
are to be returned to the Division of Medical Assistance.
(w) A special payment in addition to the prospective rate
shall be made in the year that any provider changes from the
cash basis to the accrual basis of accounting for vacation leave
costs. The amount of this payment shall be determined in
accordance with Title XVIII allowable cost principles and shall
equal the Medicaid share of the vacation accrual that is charged
in the year of the change including the cost of vacation leave
earned for that year and all previous years less vacation leave
used or expended over the same time period and vacation leave
accrued prior to the date of certification. The payment shall be
made as a lump sum payment that represents the total amount
due for the entire fiscal year. An interim payment may be made
based on an estimate of the cost of the vacation accrual. The
payment shall be adjusted to actual cost after audit.
(x) The annual prospective rate, effective beginning each July
1 , for facilities that commenced operations under the Medicaid
Program subsequent to the base year used to establish rates, and
therefore did not file a cost report for the base year, shall be
based on the facility's initial rate, established in accordance with
Paragraph (m) of this Rule, and the applicable price level
changes, in accordance with Paragraph (1) of this Rule.
(v) Effective for fiscal years beginning on or after fiscal
year 1998, installation cost of Fire Sprinkler Systems in an
ICF-MR Facility shall be reimbursed in the following
manner.
(1) Upon receipt of the documentation listed in Parts
CA) through (E) of this Subparagraph, the Division
of Medical Assistance shall reimburse directly to
the provider 90 percent of the verified cost.
££}
All related invoices.
Verification from the Division of Facility
Services that the Sprinkler System is
neededr needed to maintain certification for
participation in the Medicaid program-
Statement from appropriate authorities
that the Sprinkler System has been
installed. Examples of a ppropriate
authorities for this purpose would include
local building inspectors, fire/safety
inspectors, insurance company inspectors,
or the construction section of the Division of
Facilities Services.
(D) Three bids to install the system.
(E) Prior approval from the Division ofMedical
Assistance for any installation projected to
cost more than twenty-five thousand dollars
($25,000). Prior approval shall be granted
based upon determination by the Division of
Medical Assistance that the cost is
reasonable considering the specifics of the
installation. The burden to provide
adequate documentation that the cost is
reasonable is the responsibility of the
provider.
(2) The unreimbursed installation cost shall be
reimbursed after audit through the annual Cost
Settlement Process. This portion shall be offset by
profits, after taking into consideration any
indirect profits and direct losses. Any
overpayments determined after audit shall be
returned to the program by the provider through
the annual cost settlement process.
1505 NORTH CAROLINA REGISTER March 1, 2000 14:17
PROPOSED RULES
(3) The installation of the Sprinkler System is subject
to Prudent Buyer Standards contained in the
HCFA-15.
(4) The Sprinkler System's installation costs shall be
properly recorded on the provider's ICF-MRCost
Report.
Authority G.S. I08A-25(b): 108A-54; 108A-55; 42C.F.R. Part
447, Subpart C;
SUBCHAPTER 26M - MANAGED CARE AND
PREPAID PLANS
SECTION .0300 - MENTAL HEALTH MANAGED
CARE-CAROLINA ALTERNATIVES
.0301 PROGRAM DEFINITION AND DEFINITION
OF TERMS
.0302 ACCESS TO CARE
.0303 ENROLLEE EDUCATION
.0304 RELATIONSHIP WITH SUB-CONTRACTORS
.0305 ENROLLEE AND SUB-CONTRACTOR
APPEALS
Authority G.S. 108A-25(b);
222(g); 42CFR.431.
108A-54-55; S.L. 1993, c. 321, s.
TITLE 16 - DEPARTMENT OF PUBLIC EDUCATION
Notice is hereby given in accordance with G.S. 150B-21.2
that the State Board ofEducation intends to amend the rule
cited as 16 NCAC 6C .0402. Notice of Rule-Making
Proceedings was published in the Register on December 1,
1999.
Proposed Effectiye Date: April 1, 2001
A Public Hearing will be conducted at 9: 30 am on March 16,
2000 in Room 224, Education Bldg, Raleigh, NC.
Reason for Proposed Action: Chapter 1999-170 enacted G.S.
1 15C-12.2, requiring the State Board of Education to adopt
rules concerning voluntary shared lea\>e.
Comment Procedures: Comments may be presented orally or
in writing at the hearing, and in writing through March 31,
2000, by mail directed to Harry Wilson, State Board of
Education, 301 N. Wilmington St., Raleigh, 27601-282.5; by fax
to (919) 715-0764; or by e-mail to hwilson@dpi.state. nc. us.
Fiscal Impact
State Local Sub. None
•
CHAPTER 6 -ELEMENTARY AND SECONDARY
EDUCATION
SUBCHAPTER 6C - PERSONNEL
SECTION .0400 - LEAVE
.0402 SICK LEAVE
(a) Public school employees who earn vacation leave shall
also cam sick leave. Full-time employees shall earn one day per
month or the number of hours worked daily by a full time
employee in that class of work. Part-time employees shall earn
and may use sick leave in proportion to the part of the day for
which they are employed.
(b) The LEA may allow sick leave to be used for temporary
disability which prevents an employee from performing his or
her usual duties, illness in the employee's immediate family and
attendant medical appointments which require the employee's
attendance, death in the immediate family and medical
appointments for the employee. The For purposes of this Rule
the term immediate family includes shall include spouse,
children, parents (including the step rel ationship ) parents,
brothers, sisters, grandparents, grandchildren, and dependents
hving in the household, except that in tlie case of death, the t erm
does not include dependents but does—include siblings,
giandparent s, gi'aiidchildren, and the step, half and in-law
relat ionships, household. The term shall also mclude the step,
half and in-law relationships. An employee of any public school
system contribute vacation or sick leave to another
immediate family member who is employed by any State agency
or public school system.
(c) Employees must take leave in one-half days, whole days,
or hours as determined for earning purposes by the local board.
(d) Employees may accumulate sick leave indefinitely and
may transfer sick leave as in the case of vacation leave.
(e) LEAs may advance sick leave not to exceed the amount
which would be earned within the school year.
(f) An employee who is overdrawn on sick leave when the
employee separates from service will have the excess leave
corrected through a deduction from the final salary check.
(g) If the period of sick leave taken is less than 30 days, the
employee will return to his or her position with the LEA. If the
period of temporary disabihty exceeds 30 days, the
superintendent shall determine when the employee is to be
reinstated. The superintendent makes this decision based on the
welfare of the students and the need for continuity of
instruction.
(h) The LEA shall credit an employee who separates from
service and returns within 60 months with all sick leave
accumulated to the time of separation.
(i) Permanent full or part-time mstructional personnel,
excluding teacher assistants, who are absent due to their
personal illness or injury in excess of their accumulated sick
leave, shall be allowed extended sick leave of up to 20 work
days throughout the regular term of employment. These days do
not have to be consecutive A new employee must have reported
to work to be eligible for extended sick leave. The
superintendent may require a doctor's certificate or other
acceptable proof of the reason for the absence.
(j) An LEA may establish a voluntary sick leave bank for its
employees. Any employee of an LEA that establishes a
]4:17 NORTH CAROLINA REGISTER March 1, 2000 1506
PROPOSED RULES
voluntary sick leave bank may, but is not required to, participate
in the voluntary sick leave bank.
(1) The LEA shall develop and implement a plan for
participation that shall include those factors listed in
G.S. 115C-336(b)(iHvii) and the following:
(A) a uniform number of days to be contributed to
the bank by participants;
(B) provisions for legitimate usage of days by
participants;
(C) means to protect against overdraft of total
contributed days; and
(D) safeguards to prevent abuses by participants.
(2) The LEA shall establish a sick leave bank committee
to administer the sick leave bank.
(A) The LEA shall assure that all local personnel
are equitably represented on the committee.
(B) The LEA shall develop operational rules for
the efficient and effective functioning ofthe bank.
(C) The LEA shall develop procedures for
participants' usage of days based upon
requirements in the plan.
(D) The LEA shall specify the limits of the
committee's authority.
(E) The committee shall notify all participating
employees of the ways in which their
participation will affect their state retirement
account.
(3) The LEA shall ensure that its operational procedures
require:
(A) that payment ofsubstitutes and matching social
security are charged to the appropriate
program report code; and
(B) the reporting to the division of school business
services of the Department of the number of
employees participating itemized by job
classification, the number of sick leave days
withdrawn, the cost ofthe leave, and other data
required for fiscal and programmatic
accountability.
Authority G.S. 115C-12(8); 115C-336.
************+*+*
Notice is hereby given in accordance with G.S. I50B-21.2
that the Slate Board of Education intends to amend rules
cited as 16 NCAC 6D .0305 - .0306, .0503. Notice of Rule
-
Making Proceedings was published in the Register on
December 1. 1999.
Proposed Effective Date: July 1, 2000
APublicHearing for 16 NCAC 6D. 0305 -.0306,. 0503 will be
conducted at 10:30 am on March 16, 2000 in Room 224,
Education Bldg, Raleigh, NC.
Reason for Proposed Action: The State Board ofEducation
has determined that these rules are directly related to the
implementation of the "ABC's Act" and it is proceeding under
the authority granted by thatAct. The State Board ofEducation
has determined that there should be greater uniformity among
high schools in how end-of-course tests are factored into
student final grades. The Board has also determined that
sanctionsfor violation ofits testing code ofethics are needed to
deal with those instances where educators misuse the testing
program to distort the student performance of a class or of a
school. The Board has also determined that high school
students should be allowed to choose among several courses of
study, each ofwhich leads to graduation.
Comment Procedures: Comments may be presented orally or
in writing at the hearing, and in writing through March 31,
2000, by mail directed to Harry Wilson, State Board of
Education, 301 N. Wilmington St., Raleigh, 27601-2825; byfax
to (919) 715-0764; or by e-mail to hwilson@dpi. state. nc.us.
Fiscal Impact
State Local Sub. None
/
CHAPTER 6 -ELEMENTARY AND SECONDARY
EDUCATION
SUBCHAPTER 6D - INSTRUCTION
SECTION .0300 - CERTIFICATION
.0305 END-OF-COURSE TESTS
(a) The LEA shall include each student's end-of-course test
results in the student's permanent records and high school
transcript.
(b) The LEA shall give each end-of-course test within a 1 10-
minute period within the final ten days of the course.
(c) Starting with the 2000-2001 school year LEAs shall use
EOC test results as at least 25% of the student's final grade for
the following courses: English 1. Algebra 1. Biology. US History,
and Economic. Legal, and Pohtical Systems (ELPS). LEAs shall
use EOC test results from other courses as a part ofthe student's
final grade. LEAs shall adopt policies regarding the use ofEOC
test results in assigning final grades.
(d) Students who are enrolled for credit in courses in which
end-of-course tests are required shall take the appropriate end-of-
course test.
(e) Students who are exempt from final exams by local board
of education policy shall not be exempt from end-of-course
tests.
(f) Each student shall take the appropriate end-of-course test
the first time the student takes the course even ifthe course is an
honors or advanced placement course.
(g) Students shall take the appropriate end-of-course test at
the end of the course regardless of the grade level in which the
course is offered.
(h) Students who are identified as failing a course for which
an end-of-course test is required shall take the appropriate end-of-
course test.
(i) Effective with the 1999-2000 school year students may
1507 NORTH CAROLINA REGISTER March 1, 2000 14:17
PROPOSED RULES
drop a course with an end-of-course test within the first 1 days
of a block schedule or within the first 20 days of a traditional
schedule.
Authority G.S. lI5C-12(9)c; 115C-81 (b)(4).
.0306 TESTING CODE OF ETHICS
(a) This Rule shall apply to all public school employees who
are involved in the state testing program.
(b) The superintendent or superintendent's designee shall
develop local policies and procedures to ensure maximum test
security in coordination with the pohcies and procedures
developed by the test publisher. The principal shall ensure test
security within the school building.
(1) The principal shall store test materials in a secure,
locked area. The principal shall allow test materials to
be distributed immediately prior to the test
administration. Before each test administration, the
building level test coordinator shall accurately count
and distribute test materials. Immediately after each
test administration, the building level test coordinator
shall collect, count, and return all test materials to the
secure, locked storage area.
(2) "Access" to test materials by school personnel means
handling the materials but does not include reviewing
tests or analyzing test items. The superintendent or
superintendent's designee shall designate the
personnel who are authorized to have access to test
materials.
(3
)
Persons who have access to secure test materials shall
not use those materials for personal gain.
(4) No person may copy, reproduce, or paraphrase in any
manner or for any reason the test materials without
the express written consent of the test publisher.
(5) The superintendent or superintendent's designee shall
instruct personnel who are responsible for the testing
program in testing administration procedures. This
instruction shall include test administrations that
require procedural modifications and shall emphasize
the need to follow the directions outlined by the test
pubhsher.
(6) Any person who learns of any breach of security, loss
of materials, failure to account for materials, or any
other deviation from required security procedures
shall immediately report that information to the
principal, building level test coordinator, school
system test coordinator, and state level test
coordinator.
(c) Preparation for testing.
(1) The superintendent shall ensure that school system
test coordinators:
(A) secure necessary materials;
(B) plan and implement training for building level
test coordinators, test administrators, and
proctors;
(C) ensure that each building level test coordinator
and test administrator is trained in the
implementation of procedural modifications
used during test administrations; and
(D) in conjunction with program administrators,
ensure that the need for test modifications is
documented and that modifications are limited
to the specific need.
(2) The principal shall ensure that the building level test
coordinators:
(A) maintain test security and accountability oftest
materials;
(B) identify and train personnel, proctors, and
backup personnel for test administrations; and
(C) encourage a positive atmosphere for testing.
(3) Test administrators shall be school personnel who
have professional training in education and the state
testing program.
(4) Teachers shall provide instruction that meets or
exceeds the standard course of study to meet the
needs of the specific students in the class. Teachers
may help students improve test-taking skills by;
(A) helping students become familiar with test
formats using curricular content;
(B) teaching students test-taking strategies and
providing practice sessions;
(C) helping students learn ways of preparing to
take tests; and
(D) using resource materials such as test questions
from test item banks, testlets and linking
documents in instruction and test preparation.
(d) Test administration.
(1) The superintendent or superintendent's designee
shall:
(A) assure that each school establishes procedures
to ensure that all test administrators comply
with test publisher guidelines;
(B) inform the local board of education of any
breach of this code of ethics; and
(C) inform building level administrators of their
responsibilities.
(2) The principal shall:
(A) assure that school personnel know the content
of state and local testing pohcies;
(B) implement the school system's testing policies
and procedures and establish any needed
school policies and procedures to assure that
all ehgible students are tested fairly;
(C) assign trained proctors to test adminisfrations;
and
(D) report all testing irregularities to the school
system test coordinator.
(3) Test administrators shall:
(A) administer tests according to the directions in
the administration manual and any subsequent
updates developed by the test publisher;
(B) administer tests to all eligible students:
(C) report all testing irregularities to the school
system test coordinator; and
(D) provide a positive test-taking climate.
(4) Proctors shall serve as additional monitors to help the
14:17 NORTH CAROLINA REGISTER March 1, 2000 1508
PROPOSED RULES
test administrator assure that testing occurs fairly.
(e) Scoring. The school system test coordinator shall:
(1) ensure that each test is scored according to the
procedures and guidelines defined for the test by the
test publisher;
(2) maintain quality control during the entire scoring
process, which consists of handling and editing
documents, scanning answer documents, and
producing electronic files and reports. Quality control
shall address at a minimum accuracy and scoring
consistency.
(3) maintain security of tests and data files at all times,
including:
(A) protecting the confidentiality of students at all
times when pubhcizing test results; and
(B) maintaining test security of answer keys and
item-specific scoring rubrics.
(f) Analysis and reporting. Educators shall use test scores
appropriately. This means that the educator recognizes that a
test score is only one piece of information and must be
interpreted together with other scores and indicators. Test data
help educators understand educational patterns and practices.
The superintendent shall ensure that school personnel analyze
and report test data ethically and within the limitations described
in this paragraph.
(1) Educators shall release test scores to students,
parents, legal guardians, teachers, and the media with
interpretive materials as needed.
(2) Staff development relating to testing must enable
personnel to respond knowledgeably to questions
related to testing, including the tests, scores, scoring
procedures, and other interpretive materials.
(3) Items and associated materials on a secure test shall
not be in the public domain. Only items that are
within the public domain may be used for item
analysis.
(4) Educators shall maintain the confidentiality of
individual students. Publicizing test scores that
contain the names of individual students is unethical.
(5) Data analysis of test scores for decision-making
purposes shall be based upon:
(A) dissagregation of data based upon student
demographics and other collected variables;
(B) examination of grading practices in relation to
test scores; and
(C) examination of growth trends and goal
summary reports for state-mandated tests.
(g) Unethical testing practices include, but are not limited to,
the following practices:
( 1
)
encouraging students to be absent the day of testing;
(2) encouraging students not to do their best because of
the purposes of the test;
(3) using secure test items or modified secure test items
for instruction;
(4) changing student responses at any time;
(5) interpreting, explaining, or paraphrasing the test
directions or the test items;
(6) reclassifying students solely for the purpose of
avoiding state testing;
(7) not testing all eligible students;
(8) failing to provide needed modifications during testing,
if available;
(9) modifying scoring programs including answer keys,
equating files, and lookup tables;
(10) modifying student records solely for the purpose of
raising test scores;
(11) using a single test score to make individual decisions;
and
(12) misleading the pubhc concerning the results and
interpretations of test data.
{h} In the event of a violation of this Rule, the SBE may
impose any one or more of the following sanctions:
(1) withhold ABCs incentive awards from individuals or
from all eligible staff in a school;
(2) file a civil action against the person or persons
responsible for the violation for copyright
infringement or for any other available cause of
action;
(3) seek criminal prosecution of the person or persons
responsible for the violation; and
(4) suspend or revoke the professional license of the
person or persons responsible for the violation.
Authority G.S. 115C-12(9)c; 115C-81 (b)(4).
SECTION .0500 - PERFORMANCE APPRAISAL
SYSTEM
.0503 STATE GRADUATION REQUIREMENTS
(a) In order to graduate and receive a high school diploma,
public school students shall meet the requirements ofparagraph
(b) and shall attain passing scores on competency tests adopted
by the SBE and administered by the LEA. Students who satisfy
all state and local graduation requirements but who fail the
competency tests shall receive a certificate of achievement and
transcript and shall be allowed by the LEA to participate in
graduation exercises.
( 1
)
The passing score for the competency test, which is
the same as grade-level proficiency as set forth in
Rule .0502 of this Subchapter, shall be level 111 or
higher.
(2) Special education students may apply in writing to be
exempted from taking the competency tests. Before it
approves the request, the LEA must assure that the
parents, or the child if aged 1 8 or older, understand
that each student must pass the competency tests to
receive a high school diploma.
(3) Any student who has failed to pass the competency
tests by the end ofthe last school month ofthe year in
which the student's class graduates may receive
additional remedial instruction and continue to talie
the competency tests during regularly scheduled
testing until the student reaches maximum school age.
(b) In addition to the requirements of Paragraph (a), students
must successfiilly complete 20 course units in grades 9-12 as
specified below.
1509 NORTH CAROLINA REGISTER March I, 2000 14:17
PROPOSED RULES
(ivj
tv]
(1) Effective with the class entering ninth grade for the
first time in the W98=99 2000-2001 school year, the
2 coijjse units must include* students shall select one
of the following three courses of study:
II. Ill, and IV: career preparation, which shall
include:
(i} four credits in English language ^Is^,
which shall be English 1, 11, III, and IV:
£ii} three credits in mathematics, one of
which shall be algebra I (except as
hmited by OS, 115C-8Ub")):
(iii) three credits in science, which shall
include biology, a physical science, and
earth/environmental science:
three credits in social studies, which
shall be Economic. Legal and Political
Systems (ELPS). U.S. history, and
world studies:
one credit in health and physical
education:
yi four credits in career/technical
education, which shall be in a career
concentration or pathway that leads to a
specific career field and which shall
include a second-level (advanced)
course:
(vii) two elective credits: and
(viii) other credits designated by the LEA.
(B) three units in matliemalics, one of wliich must
be Algebra- 1; college technical preparation.
which shall include:
(i) four credits in English language arts,
which shall be English I, II, 111, and IV:
(ii) three credits in mathematics, which
shall be either algebra I. geometry, and
algebra II; or algebra l^ technical
mathematics L, and technical
mathematics II: or integrated
mathematics I. II. and 111:
(iii) three credits in science, which shall
include biology, a physical science, and
earth/environmental science:
£iy} three credits in social studies, which
shall be Economic. Legal and Pohtical
Systems (ELPS). U.S. history, and
world studies:
(v) one credit in health and physical
education.
(vi) four credits in career/technical
education, which shall be in a career
concentration or pathway that leads to a
specific career field and which shall
include a second-level (advanced)
course:
(vii) two elective credits: and
(viii) other credits designated by the LEA.
sociaLstudies, one ofwhich must
be in gov ermnent and economics, one in
United States liistory and one ui world studies;
college preparation, which shall include:
(i) four credits in English language arts.
which shall be English I. II. Ill, and IV:
tiD three credits in mathematics, which
(iii}
(iy)
(V]
lyil
shall be algebra I^ algebra IL, and
geometry or a higher level course for
which algebra U is a prerequisite: or
integrated mathematics I. II. and III:
three credits in science, which shall
include biology, a physical science, and
earth/environmental science:
three credits in social studies, which
shall be Economic. Legal and Political
Systems (ELPS). U.S. history, and
world studies:
one credit in health and physical
education:
six elective credits: and
other credits designated by the LEA.
NOTE: For admission into the UNC System it is recommended
that at least two elective credits be in one second language and
that one of these credits be taken in the twelfth grade.
(©) tlu'ee units in science, one of wliich must be
biology, one a physical sci ence, and effective
widi tlie class entering nintii grade for the
2000-2001 s c h o oH y e ar, aire
eartli/enviromnental sci ence;
(E) one unit in physical educat ion and health; and
(F) six units designated by tlie LrEA, wliich may be
undesignated electives or coui'ses designated
fi"om the standai'd couise of study.
(2) LEAs may count successfiil completion of course
work in the ninth grade at a school system which does
not award course units in the ninth grade toward the
requirements of this Rule
(3) LEAs may count successful completion of course
work in grades 9-12 at a summer school session
toward the requirements of this Rule.
(4) LEAs may count successful completion of course
work in grades 9-12 at an off-campus institution
toward the requirements of paragraph (b)(1)(F) this
Rule. 23 NCAC 2C .0305 shall govern enrolhnent in
community college institutions.
(c) Effective with the class of 2001, all students must
demonstrate computer proficiency as a prerequisite for high
school graduation The passing scores for this proficiency shall
be 47 on the multiple choice test and 49 on the performance test.
This assessment shall begin at the eighth grade A student with
disabilities shall demonstrate proficiency by the use of a
portfoho if this method is required by the student's lEP.
(d) Special needs students as defined by G.S. 115C-109,
excluding gifted and pregnant, who do not meet the
requirements for a high school diploma shall receive a
graduation certificate and shall be allowed to participate in
graduation exercises if they meet the following catena:
(1) successfiil completion of 20 course units by general
14:17 NORTH CAROLINA REGISTER March 1, 2000 1510
PROPOSED RULES
subject area (4 English, 3 math, 3 science, 3 social studies, 1
health and physical education, and 6 local electives) under
Paragraph (b). These students are not required to pass the
specifically designated courses such as Algebra I, Biology or
United States history,
(2) completion of all lEP requirements.
AuthohtyG.S. U5C-12(9b): 115C-81 (b)(4); N.C. Constitution.
Article IX, Sec. 5.
1511 NORTH CAROLINA REGISTER March 1, 2000 14:17
TEMPORAR Y RULES
This Section includes temporary rules reviewed by the Codifier ofRules and entered in the North Carolina Administrative
Code and includes, from time to time, a listing oftemporary rules that have expired. See G.S. I50B-21 i and 26 NCAC 2C
.0500 for adoption andfiling requirements. Pursuant to G.S. 150B-2I.l(e), publication of a temporary rule in the North
Carolina Register serves as a notice of rule-making proceedings unless this notice has been previously published by the
agency.
TITLE 2 - DEPARTMENT OF AGRICULTURE
Rule-making Agency: North Carolina Department of
Agriculture and Consumer Services
Rule Citation: 2 NCAC 55 .0101 - .0104; .0201 -.0203; .0301
- .0303; .0401 - .0403; .0501 - .0503
Effective Date: February 1, 2000
Findings Reviewed by Julian Mann III: Approved
Authority for the rule-making: S.L 1999-463, s.4
Reason for Proposed Action: The legislativefindings in S.L.
1999-463, the Hurricane Floyd RecoveryAct of1999, document
the effects ofHurricane Floyd on agriculture and the needfor
immediate assistance due to the impact on the public health,
safety, and welfare, and are incorporated herein by reference,
and copy is attached. Section 4 ofS.L 1999-463 also provides
authority for State agencies to adopt temporary rules to
implement Hurricane Floyd assistance programs.
Comment Procedures: Written comments may be submitted to
David S. McLeod, APA Coordinator, North Carolina
Department of Agriculture and Consumer Services, Legal
Affairs Office, PO Box 27647, Raleigh, NC 27611.
CHAPTER 55 - HURRICANE FLOYD RECOVERY
PROGRAMS FOR AGRICULTURE
SECTION .0100 - PURPOSE; AVAILABILITY OF
FUNDS; DEFINITIONS; EXPIRATION
.0101 PURPOSE
The purpose of this Chapter is to establish guidelines for the
implementation ofdisaster assistance programs for fanners who
suffered losses as a result of Hurricane Floyd The assistance
provided under this Chapter is intended to supplement federal
disaster assistance programs. This program is authonzed by the
Hurricane Floyd Recovery Act, Session Law 1999-463 of the
1999 Extra Session of the General Assembly.
History Note; Authority S.L 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
.0102 AVAILABILITY OF FUNDS
The assistance programs described in this Chapter are subject
to the availability of funds from the Hurricane Floyd Reser\'e
Fund in the Office of State Budget and Management, or from
other sources. This program shall be administered in
accordance with the Hurricane Floyd Recovery Act and the
requirements of the Office of State Budget and Management.
History Note; Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
means the Commissioner of
.0103 DEFINITIONS
As used in this Chapter:
(1) "Commissioner"
Agriculture.
(2) "Department" means the Department of Agriculture
and Consumer Services.
(3) "Disaster area" means the counties that were declared
a disaster by the President of the United States as a
result of Hurricane Floyd.
(4) "FSA" means the Farm Service Agency of the United
States Department of Agriculture.
(5) "USDA" means the United States Department of
Agriculture.
History Note; Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
.0104 EXPIRATION
This Chapter shall expire on December 31. 2000.
History Note; Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February /, 2000.
SECTION .0200 - CROP LOSS AND LIVESTOCK LOSS
ASSISTANCE
.0201 ELIGIBILITY FOR ASSISTANCE
A producer who is eligible for crop or livestock disaster
assistance from USDA-FSA shall be eligible for assistance under
this program. In addition, a producer who is riot eligible for
federal assistance may be eligible for assistance under this
program if he or she has a loss documented by USDA-FSA. A
"swine operation integrator." as defined in G.S. 143-215. lOH.
shall not be eligible for livestock loss assistance.
History Note: Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
.0202 APPLICATION PROCEDURES
Assistance under this program shall be based on information
provided to the Department by USDA-FSA. No additional
application shall be required.
14:17 NORTH CAROLINA REGISTER March 1, 2000 1512
TEMPORARY RULES
History Note: Authority S.L J 999-463, s. 4;
Temporary Adoption Eff. February 1. 2000.
.0203 MAXIMUM LEVEL OF ASSISTANCE
Subject to availability of funds, assistance may be provided in
amounts not to exceed:
(1) 1 7 percent ofa producer's crop loss as documented by
USDA-FSA: and
(2) 30 percent of a producer's livestock loss as
documented by USDA-FSA.
History Note: Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February I, 2000.
A producer vyho is eligible for assistance under the USDA-FSA
Emergency Conservation Program shall be eligible for the
cost share buy down assistance program.
History Note: Authority S.L. J 999-463, s. 4;
Temporary Adoption Eff. February /, 2000.
.0402 APPLICATION PROCEDURES
Assistance under this program shall be based on information
provided to the Department by USDA-FSA from the producer's
application for assistance from USDA-FSA under the
Emergency Conservation Program,
shall be required.
No additional application
SECTION .0300 - STRUCTURES AND EQUIPMENT
LOSS ASSISTANCE
History Note: Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
.0301 ELIGIBILITY FOR ASSISTANCE
A farm owner or operator whose uninsured farm structures,
farm roads or farm equipment were damaged or destroyed as a
result of Hurricane Floyd may submit an application for
assistance under this program to the USDA-FSA county office
on a form provided by the Department. "Structures" shall not
include lagoons, as defined in G.S. 106-802. Applications must
be received in the USDA-FSA county office by March 15. 2000.
History Note: Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1. 2000.
.0302 APPLICATION PROCEDURES
Applications shall be forwarded by USDA-FSA to the
Department. The Department shall determine eligibility for
assistance based on information provided by the farm owner or
operator in the application. The application shall include:
(1) a copy of an invoice or estimate for repairs, not to
exceed fair market value prior to Hurricane Floyd: or
(2) in the case of a total loss, a copy of an appraisal ofthe
fair market value prior to Hurricane Floyd.
The invoice, estimate, appraisal or other supporting information
must have been prepared by a person who is known to be
competent to prepare such estimates or appraisals and who has
no financial interest in the applicant's farm operations.
History Note: Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
.0303 MAXIMUM LEVEL OF ASSISTANCE
Subject to availability of funds, assistance may be provided in
amoimts not to exceed 40 percent of uninsured structure or
equipment loss, or 50 percent of farm road restoration cost.
History Note: Authority SL. 1999-463. s. 4;
Temporary Adoption Eff February 1. 2000.
SECTION .0400 - EMERGENCY CONSERVATION
PROGRAM COST SHARE BUY DOWN
.0401 ELIGIBILITY FOR ASSISTANCE
.0403 MAXIMUM LEVEL OF ASSISTANCE
Subject to availability of funds. assistance may be provided in
amounts not to exceed 1 8 percent ofthe total cost ofthe practice
approved by USDA-FSA. Assistance provided under this
Section may not be used to repair or rebuild a "lagoon." as
defined in G.S. 106-802.
History Note: Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
SECTION .0500 - COMMODITY ASSOCL\TIONS AND
COOPERATIVES ASSISTANCE
.0501 APPLICATIONS FOR ASSISTANCE
Commodity associations and cooperatives may submit an
application for assistance to the Commissioner ofAgriculttire on
a form provided by the Department.
History Note: Authority S.L. 1999-463. s. 4;
Temporary Adoption Eff. February 1. 2000.
.0502 ELIGIBILITY FOR ASSISTANCE
A commodity association or cooperarive shall provide
documentation of losses suffered due to Hurricane Floyd.
History Note: Authority S.L. 1999-463, s. 4;
Temporary Adoption Eff. February 1, 2000.
.0503 LEVEL OF ASSISTANCE
Subject to availability of funds, the Commissioner of
Agriculture may provide assistance to commodity associations
or cooperatives on a eto rata basis for losses suffered due to
Hurricane Floyd.
History Note: Authority SL. 1999-463, s. 4;
Temporary' Adoption Eff. February L^ 2000.
TITLE 4 - DEPARTMENT OF COMMERCE
Rule-makJng Agency: Department ofCommerce
1513 NORTH CAROLINA REGISTER March 1, 2000 14:17
TEMPORARY RULES
Rule Citation: 4 NCAC IM.0101-.0107
Effective Date: February 1, 2000
Findings Reviewed and approved by: Julian Mann, III
Authority for the rule-making: S.L. 1999-463
Reason for Proposed Action: Rules governing loans and
interest rebates to small businesses damaged by Hurricane
Floyd
Comment Procedures: Comments or questions may be
directed to Gene Byrd, Department of Commerce, 418 Mail
Service Center, Raleigh, NC 27699-4318, (919) 715-5747.
CHAPTER 1 - DEPARTMENTAL RULES
SUBCHAPTER IM - HURRICANE FLOYD BUSINESS
ASSISTANCE PROGRAMS
.0102 ELIGIBILITY
(a) All businesses must apply for a SBA disaster business
loan to be eligible for these programs.
(1) Interest rebates will be available to aU business
owners who borrow from the SBA and will be based
on the amount ofmoney borrowed and the repayment
terms. Amounts approved by the SBA and amounts
actually disbursed by them may differ. Rebates will
be based on the funds actually disbursed.
(2) A business owner that exhausts the SBA funding and
reconsideration process and submits proof of having
been a legitimate business prior to the disaster will be
eligible for NC READE flmds.
(b} Examples of proof include, but are not limited to,
possession of a valid business hcense. a business plan, and a
commercial property lease.
(c) Abusiness must demonstrate the potential to recover from
the disaster and remain an going concern with the infusion of
NC READE fimds.
SECTION .0100 - GENERAL INFORMATION
.0101 SCOPE
(a) The Department ofCommerce shall operate a program of
assistance to businesses in order to protect jobs in the disaster-damaged
counties of eastern North Carolina.
(b) Interest rebates shall be available to business owners who
are approved for a disaster business loan from the U. S. Small
Business Adminisfration (SBA) for physical damage or
economic injury to their business as a result of Hurricane Floyd.
(c) A loan program for businesses that do not qualify for SBA
loans shall be knovro as the NC Recovery and Development
Fund (NC READE). Loans will be available to businesses for
both physical damage and economic injury suffered as a result
of Hurricane Floyd. Loans will be made to businesses that
suffered damage and have been unable to qualify for a Small
Business Administration (SBA) disaster business loan. A
business will be deemed to be unable to qualify for a SBA
disaster business loans when:
(1) an initial application for SBA loan has been declined:
and
(2) an application for reconsideration by SBA has also
been declined.
(d) The business must be located in one of the counties
declared a major disaster as a result of Hurricane Floyd by the
President of the United States under the Stafford Act (P. L. 93-
288).
(e) Applications will be accepted for six months following the
final application deadline for SBA business loans for physical
damage caused by Hurricane Floyd.
(D NC READE applicants must have contacted a Business
Recovery Assistance Center b^ the final deadline to start the
SBA reconsideration process.
History Note: Authority G.S. 150B-21. 1; S.L 1999-463;
Temporary Adoption Eff. February I. 2000 to expire on January
1, 2003
History Note: Authority G.S. 150B-21. 1; SL. 1999-463;
TemporaryAdoption Eff. February 1, 2000 to expire on January
1, 2003.
.0103 BENEFITS UNDER THE INTEREST REBATE
PROGRAM
The interest rebate program will offer rebates equal to the
interest payments projected to be made by the successfiil SBA
business borrower for the first three years on the finalized SBA
disaster business loan from damage sustained as a result of
Hurricane Floyd.
History Note: Authority G.S. 1508-21. 1; SL. 1999-463;
TemporaryAdoption Eff. February 1, 2000 to expire on January
1. 2003.
.0104 BENEFITS UNDER NC READE
(a) A NC READE loan yyill be for a period ofeight years. All
payments will be deferred for the first three years and the loan
will accrue no interest during that period. The final five-year
period will accrue interest at 4% and will amortize the principal
balance through regular monthly payments of principal and
interest. There will be no penalty for early repayment.
(b) Maximum funding under NC READE will be tied to the
number of jobs provided by the business prior to Hurricane
Floyd. Regardless of the maximum funding for which the
business qualifies, fimding will not exceed the actual physical
damage and economic injury sustained by the business from
Hurricane Floyd.
(c) The number of jobs provided by each business will be
verified by Form NCUl 101 filed by the business with the
Employment Security Commission of North Carolina (ESC).
(1) A business that provides 5 jobs will be eligible for
maximum funding of twenty-five thousand dollars
($25.000).
(2) A business that provides 6-10 jobs will be eligible for
maximum funding of twenty-five thousand dollars
14:17 NORTH CAROLINA REGISTER March 1, 2000 1514
TEMPORAR Y RULES
Ql
14}
£5]
($25.000), plus four thousand dollars ($4.000) for
each incremental job.
A business that provides 1 1-25 jobs will be eligible
for maximum funding of forty-five thousand dollars
($45.000). plus three thousand dollars ($3.000) for
each incremental job.
A business that provides 26-100 jobs will be ehgible
for maximum fimding of ninety thousand dollars
($90.000). plus two thousand five hundred dollars
($2.500) for each incremental job.
A business that provides in excess of 1 00 jobs will be
eligible for maximum funding oftwo hundred seventy
seven thousand, five hundred dollars ($277.500) plus
two thousand dollars ($2.000) for each incremental
job.
(6) The N. C. Department of Commerce will determine
maximum funding for businesses that provide over
100 jobs on a case-bv-case basis.
History Note: Authority G.S. 150B-2I. 1; S.L. 1999-463;
TemporaryAdoption Eff. February 1, 2000 to expire on January
1. 2003.
.0105 PROCEDURES FOR INTEREST REBATE
FOR SBA BORROWERS
(a) Applicants will apply for interest rebates through the
Business Recovery Assistance Centers (BRAC ) administered by
the University of North Carolina (UNO Small Business and
Technology Development Centers (SBTDC) in cooperation with
the Department of Commerce.
(b) The borrower will present to the BRAC Counselor a copy
ofhis Loan Authorization and Agreement and a copy ofhis most
recent disbursement letter showing the outstanding balance of
the loan.
TTie BRAC counselor will perform a mathematical
calculation to estimate the interest to be paid by the
borrower over the ensuing three years.
The borrower will affirm that he is entitled to this
interest rebate, that the information is true and correct
to the best of his knowledge and that the rebate will
not be used to duplicate any benefits received under
any Federal program.
Upon completion of the request and supporting
documents, the BRAC counselor will forward said
banks
m
m
Oi
application to one of the two agent
payment.
for
(c) Upon receipt by the bank, the documents will be reviewed
for completeness, a check will be prepared and mailed to the
borrower. The bank will forward said check to the borrower
within five working days of the receipt of the request.
(d) The borrower will receive a notice with the rebate check
to inform the recipient that rebate proceeds are subject to federal
duplication of benefits limitations and that the State of North
Carolina vyill inform the SBA that the borrower has received the
rebate.
History Note: Authority G.S. 150B-21. 1; S.L. 1999-463;
TemporaryAdoption Eff. February I, 2000 to expire on January
1, 2003.
.0106 PROCEDURES FOR NC READE
(a) Applicants will apply for NC READE through the
Business Recovery Assistance Centers (BRAQ administered by
the University of North Carolina (UNC) Small Business and
Technology Development Centers (SBTDC) in cooperation with
the Department of Commerce.
(b) The applicant will bring the decline letter fi-om the SBA
to the Business Recovery Assistance Center. Additionally, the
applicant should bring a copy ofthe completed SBA applicadon.
the most recent pre-Hurricane Floyd NCUI 101 and other
documentation supporting the situation of the business before
the hurricane and the extent of damage suffered firom the
hurricane.
(c) If the applicant does not have the required information,
the BRAC will prepare a written request to the SBA for specific
file items required to make a decision.
(d) If the SBA. on their first review has declined the
applicant, the BRAC will assist the applicant to address any
deficiencies noted by the SBA. The BRAC will ensure re-submission
of the application.
(e) Upon resubmission to the SBA. the approved NC READE
applications will be submitted to agent banks for processing,
document preparation and fimding.
(f) Should the SBA approve a loan upon reconsiderafion. the
borrower will repay the principal amount of the NC READE
loan.
History Note: Authority G.S 150B-21.1; S.L. 1999-463;
TemporaryAdoption Eff February 1, 2000 to expire on January
1. 2003.
.0107 APPEAL
An applicant may appeal a fimding decision under these
programs to the Office of the Assistant Secretary for Economic
Development. NC Department of Commerce. The Assistant
Secretary will convene a three-person committee to include
himself, the Director ofthe Commerce Finance Division and one
other member named by the Assistant Secretary. Upon a full
and complete review of the facts in each case, the committee
shall recommend a decision to the Secretary of Commerce. The
decision of the Secretary shall be final.
History Note: Authority G.S. 1503-21. 1; S.L. 1999-463;
TemporaryAdoption Eff. February 1. 2000 to expire on January
1. 2003.
TITLE 15A - DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES
Rule-making Agency: NC Department of Environment and
Natural Resources
Rule Citation: 15A NCAC IC .0505; IP .0101-.0105; IQ
.0101
1515 NORTH CAROLINA REGISTER March 1, 2000 14:17
TEMPORARY RULES
Effecrive Date: February 4, 2000
Findings Reviewed and Approved by: Julian Mann, III
Authority for the rule-making: G.S. JJ3A-4; 113A-6; 113A-U;
143B-10: S.L. Extra Session J 999-463. Part IV. c. 463. s. 4
Reason for Proposed Action: The NC Department of
Environment and Natural Resources plans to adopt temporary
rules for the expenditure of funds in relation to the
Implementation Planfor Use ofHurricane Floyd ReliefFunds -
House Bill 2 (Extra Session 1999) to thefollowing Sections:
ISA NCAC IC .0505 - The Hurricane Floyd Recovery Act
applies to activities that arefunded with public moniesfrom the
Hurricane Floyd Reserve Fund and that are taken in response
to the damage wrought by the hurricanes which occurred in
North Carolina in September and October of 1999. The
Department will streamline the breadth andscope ofits existing
SEPA rules to expedite review of activities funded from the
Fund.
15A NCAC IP. 0101:0105- Grants to Commercial Fishermen
for Damages Caused by Hurricanes. To establish the
application procedures, eligibility requirements, and process
for disbursement offunds to commercialfishermen for loss of
income orfor damages or loss ofequipment.
15A NCAC IQ.OIOl- Solid Waste Sites andJunkyards Section.
Establish criteriafor remediating high risksolid waste sites and
junkyards in the 100 year flood plains in areas affected by
Hurricane Floyd.
Comment Procedures:
15A NCAC IC .0505- Comments are welcomed and may be
submitted to Ms. Melba McGee. DENR, Division ofLegislative
and Intergovernmental Affairs. 1601 Mail Service Center,
Raleigh. NC 27699-1601. (919) 715-4194.
15A NCAC 1P.0101-.0105 - Comments are welcomed and may
be submitted to Juanita Gaskill, DENR, Division of Marine
Fisheries. PO Box 769. Morehead City. NC 28557.
15A NCAC IQ .0101 - Comments are welcomed and may be
submitted to Mr. BillMeyer. Director, DENR, Division ofWaste
Management, 1646 Mail Service Center, Raleigh, NC 27699,
(919) 733-0692. ext. 202.
CHAPTER 1 - DEPARTMENTAL RULES
SUBCHAPTER IC - CONFORMITY WITH NORTH
CAROLINA ENVIRONMENTAL POLICY ACT
SECTION .0500 - MINIMUM CRITERIA
,0505 NON-MAJOR HURRICANE RELIEF
ACTIVITY
The following minimum criteria are established as indicators
of thresholds for activities undertaken in response to "The
Hurricane Floyd Recovery Act of 1999" for which
envirormiental documentation under the North Carolina
Environmental Policy Act (NCEPA) is required. Activities
which are below these thresholds are sufiRcientlv controlled by
existing statutory and regulatory framework so that no additional
environmental documentation under NCEPA is required. Asset
forth in Rule .0503 of this Section, the Secretary may require
environmental documentation for activities that would otherwise
quality under these minimum criteria thresholds. These
Hurricane Floyd Recovery Act minimum criteria apply to
activities that are funded with public monies from the Hurricane
Floyd Reserve Fund and that are conducted in response to the
damage wrought by the hurricanes which occurred in North
Carolina in September and October of 1999. Except as
referenced in this Rule, these Hurricane Floyd Recovery Act
minimum cnteria temporarily replace the minimum criteria in
Rule .0504 of this Section. Activities and buildings including
the following require documentation under NCEPA:
(1) Structures located in the 1 00-year floodplain that are
not raised above the 100-year flood plain building
elevation for the site as recommended by FEMA or as
required by local ordinance, whichever is more
stringent.
(2") "Subdivisions." as defined in G.S. 153A-335 and
160A-376. not served by an approved septic or other
waste disposal system.
(3} "Subdivisions," as defined m G.S. 153A-335 and
160A-376. without 20% open space included in the
development plan or without a 50-foot or greater
vegetated buffer along perennial and intermittent
streams as indicated on the most current version of
the 1:24.000 scale 17.5 minute quadrangle United
States Geological Survey topographic map or the
county soil survey map prepared by the Natural
Resources Conservation Service of the United States
Department of Agriculture.
(4) Expansion of wastewater treatment systems or
potable water systems in excess of the capacity
required to serve replacement dwellings, replacement
commercial structures, and replacement industrial
facilities for Hurricane Floyd recovery and in excess
of the activities identified in Rule .0504(3)(a). (3)(b)
of this Section.
(5) Filling or otherwise altering wetlands except in the
replacement of single family dwellings when the
entire tract of land is wetland and wetland fill is less
than 1/3 acre and the building site is located so as to
have the least negative impact foreseeable on the
wetland.
(6) Groundwater withdrawals in excess of those
described in Rule .0504(3)(c ) of this Section.
(7) Land disturbing activities covering an area greater
than five acres that require a sediment and erosion
control plan and are located within a High Quality
Waters Zone or an Outstanding Resource Waters
Zone.
(8) Reforestation of woodlands not in accordance with
the National Forest Service or the Division ofNC. of
Forest Resources woodlands management plans.
(9) Use of forestry best management practices not
consistent with the performance standards in Forest
Practice Guidelines Related to Water Quality codified
14:17 NORTH CAROLINA REGISTER March 1, 2000 1516
TEMPORARY RULES
im
(12)
(13)
(14)
as 15ANCAC II.
Removal of logs, stumps, trees, and other debris from
stream channels in excess ofthose activities described
in Rule .0503(3)(m) of this Section.
Drainage projects where the mean seasonal water
table elevation vyill be lowered more than one foot
over an area of one square mile or more, and riparian
and wetland areas will be permanently effected.
Development activities within Areas of
Environmental Concern ofthe 20-countv coastal area
which require a CAMA Major or Minor Permit and
are listed in Rule .0504(f) of this Section.
Rebuilding in the 100-vear floodplain of any
component of a liquid animal waste management
system for which a permit is required under Part 1 or
Part lA of Article 21 of Chapter 143 of the General
Statutes, other than a land application site, when the
total animal waste management system was damaged
more than 50% of the total cost of new construction.
Structures 50 years or older for which no separate
law, rule or regulation dictates a formal review and
approval process and for which detailed location
maps have not been provided by the applicant to the
North Carolina Department of Cultural Resources for
action by the State's Historic Preservation Officer.
History Note: Authority G.S.: 1I3A-4; 1 13A-6; 1 13A-1 1;
143B-10: S.L Extra Session 1999-463, Part IV, c.463, s.;
TemporaryAdaption Eff. February 3. 2000 to expire on January
1. 2003.
SUBCHAPTER IP - GRANTS TO COMMERCIAL
FISHERMEN FOR HURRICANE DAMAGE
SECTION .0100 - GRANTS TO COMMERCIAL
FISHERMEN FOR HURRICANE DAMAGE
.0101 GENERAL
(a) Only commercial fishermen who held a valid Standard
Commercial Fishing License. Retired Standard Commercial
Fishing License or a Shellfish License for North Carolina
Resident without a Standard Commercial Fishing License during
September or October. 1999. and are determined by the Division
of Marine Fisheries to be an affected fishermen in an affected
fishery are eligible to apply for compensation for
reimbursement of documented losses of commercial fishing
income or for damage to or loss of commercial fishing
equipment.
(b) Until funds are exhausted, the maximum amount that
shall be reimbursed any individual fisherman shall be 60 percent
of the total loss of income and equipment combined. Once the
total funds are e